Sunday, July 29, 2018

Fund CareShield Life through payroll tax

There is a lot of controversy about the premium rates for CareShield Life.

Some of the arguments are:

a) Should females be required to pay a higher rate compared to males?

b) Why should this scheme be compulsory?

c) Is the premium rate too high?

d) Are the claim criteria too stringent?

e) Why should the compulsory nature apply only to younger people? Are the older people being denied?

f) Is the government creating the scheme to make profit for itself?

This controversy is inherent in the nature of the scheme - a compulsory scheme that has to be fully paid through contributions (except for means tested subsidies).

What is a better approach?

It is better for the compulsory scheme to be paid through payroll tax, e.g. 0.5% of the payroll.

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