A $1.1 trillion budget deal released by congressional leaders yesterday could push the implementation of the Cadillac Tax back by two years, to 2020. Many see this delay as a stepping stone to a full repeal, although, as Mercer’s Geoff Manville points out in this Business Insurance article, this postponement also “really clouds the outlook for implementation of the tax.” A delay in the excise tax would be a welcome relief for employers, and especially the 29% of employers with at least one plan that was likely to exceed the tax threshold in 2018 (according to Mercer research). In addition, the proposal includes a request for further investigation into the benchmarks the reform law currently uses and whether the excise tax should be adjusted to take into account factors other than cost, such as age and gender factors, which has been a key argument among opponents of the Cadillac tax. Stayed tuned for further developments!
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