Paying Taxes on Paying Taxes

One of my tasks at my job is the maintain the payroll computer code. One of my recent assignment was to modify to code to handle taxes on life insurance. One of the benefits from my employer is paid life insurance premiums. Of course this happens to be a taxable benefit. My beloved government in all it's wisdom, dose not tax this benefit on what it costs my employee but on what the IRS thinks the benefit is worth which my based on age and amount of coverage. It turn out that for me the tax on life insurance is 78 cents per month. (If you older the tax increases to tens of dollars per month) My employer being the generous employer they are, was nice enough to go ahead a pay the 78 cents per month for me. Thank you, Thank you. However, I am still responsible to pay income tax on that extra 78 cents per month. So since my employer pays the tax, I'm taxed for having my tax paid. But on the plus side that extra 78 cents is matched 6% for retirement so I get about .4 cents a month extra in my retirement account. Flat sales tax anyone?