Hourly Notes: Complementary tax to 7% passed

The controversial heavier taxation of complementary health, mutual funds or private insurers, was finally passed by parliament yesterday after a final Senate vote.

The rate of the special tax on insurance agreements (TSCA) on "caring and responsible contract", which now account for almost all contracts offered by complementary health, will increase from 3.5% to 7%. This tax increase will bring the state 100 million euros from 1.1 billion in 2011 and full year, as determined by the government.

The left has strongly opposed the provision which it unsuccessfully sought the removal. She sees it as "unfair" and "detrimental to the working and middle classes."

Mutuals, who opposed the measure, for their part say they are forced to pass the increase on their rates contrary to what the Government. "The mutual insurance companies are not required to fully pass this increase," said Health Minister Xavier Bertrand. "No mutual insurance company is not in financial difficulty," he said.

"It is no secret reserves"

But for the French Mutuality, which includes 600 mutual health insurance, they have no choice and must raise their rates. "In a very simple economic model in which mutuals operate with a single source of reserves, namely the contributions, and only one source of expenditure, that is their benefits, how can they pay 13.27% taxes (counting all taxes imposed on the sector, ie) without these contributions affect? "asked the president Etienne Caniard.

"It is no secret reserves" in the cases of mutual, he said.
"The margins have decreased, which is not surprising since all the mutuals have done in previous years for not fully pass the new taxes," argued Mr. Caniard, describing the extent of "unjustifiable".

His view is shared by the Group of Mutual insurance companies (Gema), trade union. "Maybe there are a number of which are in mutual capacity to absorb this increase, but not the general state of the market. All this is relatively tight," said its president Gerard Andreck.
"This will put more people out of reach of a mutual," he said.

Mutuals are nonprofit and can not, by their status, be in deficit.

Possible side effect of taxation: the complementary health may now be reluctant to fund a portion of excess fees of the surgeons, anesthetists and obstetricians in a new area said option to be established alongside an industry under agreement and fee-free area 2. Meeting within the Unocam, the complementary health must bring their response before the end of the month.