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Mesothelioma- The Financial Costs to Society
by Alex G Melan
http://www.mesotheliomamedic.com
Much has been written about asbestos related diseases such
as Meothelioma over the last couple of years. The focus
has been on three main areas:
a) The unfortunate victims of mesothelioma such as former
employees of asbestos mining companies who caught these
diseases whilst in the course of their employement. We
have seen the heart rendering images on TV of these
people, all of them in their retirement years gasping for
breath and suffering enormously.
b) Whether the asbestos mining companies knew that
asbestos mining was a danger to human life.
c) The Multibillion dollar class actions filed by the
victims against their former employers seeking
compensation.
Two issues that have not been addressed are the financial
costs to society of asbestos related diseases such as
Mesothelioma Cancer and who pays for these costs.
Secondly, should asbestos mining companies be paying
compensation not only to the sufferers of mesothelioma and
other diseases but also to Society as well?
There are two costs to society that can be identified. The
first cost is to the public health system. The second cost
is the loss of tax revenue by governments due to Asbestos
mining companies claiming a tax deduction for compensation
payments that are made to the victims.
In illustration of the costs to the public health system,
the Asbestos Diseases Foundation of Australia has stated
that by 2020 there will be 13000 cases of mesothelioma and
40000 asbestos related lung cancer diseases, totaling
53000 people and this is only in Australia! This means
that 53000 people will need to have constant medical
attention for the next 15 years or so. The question
therefore, who pays for the cost? The answer of course is
the current taxpayer and the next generation of taxpayers.
In relation to tax revenue, governments are essentially
missing out on tax revenue as the asbestos companies are
claiming the compensation payment as a tax deduction. For
illustrative purposes, assume that an asbestos mining
company pays out $100m per year over five years to the
victims. Also assume that the corporate tax rate is 30 per
cent. Therefore over five years, a respectrive government
is losing $150m in tax revenue. Essentially it means that
the asbestos mining companies are sharing the costs with
the taxpayer. They pay 70 per cent of the compensation
payment and the taxpayer pays the remaining balance. Most
people would view this as totally inequitable.
It can be seen that the Asbestos companies are only paying
part of the costs and not the full cost.
To rectify this, there are two possible solutions.
a) Respective Governments should also join class actions
with Mesothelioma sufferers against the asbestos mining
companies seeking compensation for medical and future
medical costs. This would not be unprecedented as various
State Governments of the United States sought compensation
against the Tobacco Companies to pay for the medical costs
of its citizens who needed medical attention because of
the ill effects of smoking.
b) Governments deny a tax deduction for Mesothelioma
compensation payments made by the asbestos mining
companies.
Until either part a or part b happens, it is the taxpayer
who will be unfairly burdended with the additional
financial costs of Asbestos related diseases such as
Mesothelioma.
Author: Alex G Melan of Mesotheliomamedic.com
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