Thursday, March 25, 2010

et plus le deluge...

And hey, what about that bastion of evil, Caterpillar1?
Caterpillar Inc. said Wednesday it will take a $100 million2 charge to earnings this quarter to reflect taxes stemming from the newly enacted U.S. health-care legislation.

The world's largest construction equipment manufacturer by sales warned last week that provisions in the legislation would subject it to federal income taxes on the subsidies it receives for providing prescription drug benefits for its retirees and their spouses.

Since the Medicare Part D program was enacted in 2003, the Peoria, Ill., company and more than 3,500 others that already provided drug-benefit expenses to retirees have received tax-free subsidies as an incentive to maintain their drug programs.

The subsidies average $665 per person covered by a company-sponsored prescription program, according to benefits consultant Towers Watson.

About 40,000 Caterpillar retirees receive company-sponsored drug benefits, which are more generous than Medicare's drug plan, which requires recipients to pay some out-of-pocket expenses.

The charge is expected to be a one-time cost, but Caterpillar argues that higher taxes and other potential cost increases related to insurance mandates in the legislation will hinder the company's recovery this year after a 75% profit plunge in 2009.
Thank God - THANK GOD! - that we have Obamacare in place to provide health insurance for all of those workers that will be put out of work by ... Obamacare...

1 - Bob Tita. (2010, March 25). Caterpillar Income Hit By Health Bill Provision. Wall Street Journal (Eastern Edition), p. B.1. Retrieved March 25, 2010, from ABI/INFORM Global. (Document ID: 1992661551).

2 - What's Caterpillar going to do with $100 million anyway? Pay employees? Stockholders? Suppliers? Nah, much, much better that the Federal government take that money and use it to pay IRS agents and health-care bureaucrats...

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