Michael Ahern
Question:19 Mr. M. Ahern asked the Minister for Finance the implications, if any, for the Exchequer of the opening-up of the Irish health insurance market. [24148/96]
Written Answers. - Health Insurance.
It is impossible to predict what impact increased competition will have on the Exchequer. However, if it leads to a more cost efficient and better provision of service, it is to be welcomed. The new framework for private health insurance will require all insurers to compete on equal terms.
As regards the taxation aspect, the opening up of the Irish health insurance market as required by EU law makes it necessary to ensure that a common tax regime applies to all providers of health insurance operating in the Irish market. As Deputies will be aware, the promotion of private health care through health insurance has been facilitated by various tax reliefs, but principally by income tax relief for premiums paid in respect of VHI-type cover which is now available at the standard rate. This relief, which currently costs the Exchequer about £48 million a year, is available to all authorised health insurers. Certain changes in existing corporate tax and stamp duty provisions will be necessary and these are currently being examined with a view to including amendments, as appropriate, in next year's Finance Bill.