Backwards Taxing

The Associated Press: Tax on health benefits likely to be in Senate bill: "WASHINGTON (AP) — Legislation to be outlined next week in the Senate Finance Committee will likely include a new tax on workers with the costliest employer-provided health coverage, officials said Friday, but with implementation delayed until 2013 to minimize any political fallout.

Officials familiar with internal deliberations said the leading option under consideration by Sen. Max Baucus, D-Mont., the committee chairman, would mean higher taxes for workers whose family coverage costs $15,000 a year or more in premiums paid by employer and employee combined..."

If the goal is to force everyone to have health insurance, wouldn't it make more sense to tax the employees and employers who have no insurance rather than taxing those that do? Taxing the insured seems like an incentive to drop your insurance, not keep it.

So if I"m going to be taxed on benefits, shouldn't I be able to deduct the cost of copays and other medical expenses? If not, then why do this kabuki dance? Just increase the income tax to get the money and be done with it.