Cadillac Tax Delay

On December 18, 2015, President Obama signed the Consolidated Appropriations Act, 2016 (Act) delaying the effective date of the “Cadillac Tax” until 2020 and making the tax deductible.  Leading opponents of the tax have said they would continue to press for it to be rescinded altogether.

The House voted 316-113 Friday to approve the omnibus spending deal that congressional leaders unveiled earlier in the week. The Senate followed quickly with a 65-33 vote to approve the package and send it to President Barack Obama, who indicated he would not veto the measure.

Opponents of the 40% excise tax, which would be imposed on the portion of group health plan premiums that exceed $10,200 for single coverage and $27,500 for family coverage under the Patient Protection and Affordable Care Act, say the two-year delay is a major win for employers.

In addition to the two-year delay Congress passed Friday, the omnibus budget bill also calls for a study by the U.S. comptroller general and the National Association of Insurance Commissioners of whether the ACA uses “suitable” benchmarks to determine if the tax should be adjusted to reflect age and gender factors in setting the excise tax thresholds.

*Awane.com

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