Federal Council wants to increase tax deduction for health insurance premiums

The Federal Council plans to increase the deduction for premiums of mandatory health insurance and accident insurance in the direct federal tax. New, a deduction of 3,000 francs (previously: 1,700 francs) should be allowed for singles and 6,000 francs (previously: 3,500 francs) for married couples.

The Federal Council proposes to increase the deduction for premiums of mandatory health insurance and accident insurance in the direct federal tax.

Increase in Deduction for Health Insurance Premiums

Newly, married couples can deduct up to 6,000 francs instead of the previous 3,500 francs. For all other persons, the amount should increase from 1,700 francs to 3,000 francs. Per child or dependent person, the deduction limit should also increase from the previous 700 francs to 1,200 francs. Principally, the new regulation should also apply to cantonal taxes, although the cantons can still determine the deduction amount as before.

No Deduction for Non-Mandatory Health Care Anymore

At the same time, the Federal Council suggests that premiums for non-mandatory health insurance and life insurances as well as the interest on savings balances should no longer be deductible in the future. However, these can hardly be deducted today because the deductible maximum amount is generally already reached by the mandatory health insurance premiums. Therefore, little will change for most people due to the new regulation. The increased deduction for people who are not employed should also be abolished, as these do not pay higher mandatory health insurance premiums than employed persons. This change is justified because affected individuals can claim higher deductions due to the general increase than before.

Revenue Loss of 290 Million Francs

The proposed measures will lead to lost revenues of approximately 290 million francs per year in direct federal tax. Of this, around 230 million francs will be borne by the federal government and about 60 million francs by the cantons. The cantons will also face one-time adjustment costs to implement the new law.

Source: Press release from the Federal Government on 11.06.2021 - https://bit.ly/3ADw6bu

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