Sens. Cornyn, Harkin Introduce WHIP Act To Provide Tax Incentives To Small Businesses That Encourage Healthy Lifestyles

U.S. Sens. John Cornyn, a member of the Senate Finance Committee, and Tom Harkin, a member of the Health, Education, Labor & Pensions Committee, joined forces to introduce the Workforce Health Improvement Program (WHIP) Act, legislation that would help small businesses provide wellness benefits to their workers by correcting an inequity in the tax code. The WHIP Act not only reaffirms the right of employers to deduct the cost of providing off-site fitness center benefits to their workers, but it would also allow employees to exclude up to $900 of the off-site wellness benefit they receive from being considered taxable income.

“We need to do more to help employers encourage healthy lifestyles. Small businesses are responsible for 70 percent of new jobs created each year, and a healthy workforce is a productive workforce. Providing small businesses and their workers with a tax incentive to encourage healthy lifestyles will result in happier, healthier and more productive employees, which will lower health care costs and in turn help revitalize our economy,” said Sen. Cornyn.

“When employers encourage active and healthy lifestyles, employees work harder, miss less days due to sick leave and are more productive. Our nation is facing an obesity epidemic which can lead to serious health conditions like heart disease and diabetes. Offering a tax deduction to employers who provide wellness benefits, like gym memberships, and reward employees who engage in these activities, is one step forward we can take to promote healthier lifestyles,” said Sen. Harkin.


Current law permits businesses to deduct the cost of on-site workout facilities, which are provided for the benefit of employees on a pre-tax basis. However, many small employers do not have the resources or office space to offer on-site exercise rooms and fitness programs. The WHIP Act makes it easier for small businesses to offer important exercise incentives to their workers without bearing the full cost, which they are currently required to do.

Physical inactivity is a key contributing factor to obesity and adversely affects workforce productivity. According to the Centers for Disease Control and Prevention (CDC), the economic cost alone to businesses in the form of health insurance and absenteeism is more than $15 billion. Additionally, the CDC estimates that more than one-third of all U.S. adults fail to meet minimum recommendations for aerobic physical activity based on the 2008 Physical Activity Guidelines for Americans.