BusinessDay reports that Finance Minister Enoch Godongwana has expressed caution about the Department of Health’s (DOH’s) proposal to phase out medical scheme tax credits to help fund National Health Insurance (NHI).

The DOH has told parliament that scrapping those credits could begin as early as next April, starting with high-income earners. In a media briefing prior to the tabling of his medium-term budget policy statement (MTBPS), Godongwana said: “My worry … is that if you look at who is paying our PIT (personal income tax), it’s the same group you want to take medical credits away from. It’s actually an attack on the middle class. I’m not saying we should not do medical tax credits, but once we do that we must present … the alternative.” The issue was under discussion with the DOH, but the Treasury had yet to finalise its position, said the Treasury’s Chris Axelson.

Medical tax credits include a tax credit for medical scheme contributions. The Board of Healthcare Funders and the Health Funders Association maintain that medical tax credits are a vital measure to help keep medical scheme membership affordable and reduce the load on state healthcare facilities.

• Read the full original of the report in the above regard by Tamar Kahn at BusinessDay (subscriber access only)
• Read too, Scrapping medical tax credits not on the cards, says Godongwana, at Moneyweb

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