President George W. Bush on Saturday proposed tax breaks to make health insurance more affordable to the nearly 47 million Americans who lack it, while removing some tax benefits for the most expensive employer-provided health care plans.

The president, looking to gain momentum for his domestic agenda amid concerns it will be overshadowed by the Iraq war, will include the health proposal in his State of the Union address on Tuesday.

Currently, employees who receive health coverage through their jobs do not pay taxes on the benefit. Bush would set a cap on the amount of coverage that would be considered tax-free. Anything above that would be taxed as income.

The basic concept is that employer-provided health insurance, now treated as a fringe benefit exempt from taxation, would no longer be entirely tax-free. Workers could be taxed if their coverage exceeded limits set by the government. But the government would also offer a new tax deduction for people buying health insurance on their own.

“I will propose a tax reform designed to help make basic private insurance more affordable,” Mr. Bush said in his weekly radio address on Saturday, “whether you get it through your job or on your own.” He did not offer specifics, but an administration official provided details of the plan.

It would work like this: The administration would cap the amount of benefits that can remain tax free at $15,000 for a family and $7,500 for an individual. Anyone whose health insurance cost more than that would pay taxes on the difference. For example, a family with coverage costing $16,000 a year would pay taxes on $1,000.

The cap would also be used to establish the amount of the new deduction for people who lack coverage. In this example, a family buying insurance on its own could take a $15,000 deduction — even if the insurance cost less. The cap would rise with some measure of overall inflation, but would not necessarily keep pace with the costs of medical care and health insurance.

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