I’ve quit buying from Hobby Lobby despite them being my favorite store.
They claim a religious exemption from providing birth control as part of their health care offering.
What they are getting wrong is that they are not providing anything to their employees but are instead doing bookkeeping for the IRS.
- The health care benefits a company provides to its employees is remuneration for the employee’s labor, not a gift.
- The government has decided that individuals should not pay income tax on reasonable or necessary health care.
- The government has decided that individuals are not to be trusted with honest reporting of those expenses and has made employers responsible for that reporting, similar to the withholding rules.
- Corporations and businesses benefit from this arrangement in that they report employee health benefits as an expense that lowers their tax bill. Gifts to employees would not be a deductible expense.
- For many other areas of economic concern the SCOTUS has declared that there is little constraint on the nature of government regulation (Commerce Clause), the government has nearly unlimited rights to define the terms of the deal.
- The government thereby has near total freedom to define what a health care plan must provide to be treated as remuneration to an employee that is exempt from taxation.