The present health contribution was introduced by the Health Contributions Act, 1979. All individuals aged over 16 years were made liable to the levy on all of their income with minor exceptions. Current exemptions from the health contribution include social welfare payments, including social welfare pensions, maintenance payments and non-pecuniary income such as benefit-in-kind. Persons in receipt of a medical card are not liable to pay the health contribution. Other persons exempt from the health contribution include persons in receipt of social welfare widowed pensions, the deserted wife's benefit and the lone parent's allowance. The 1994 budget also introduced a low income exemption threshold for the levy below which there is no liability to the contribution. This threshold was substantially increased in the Social Welfare Act, 2000, and is currently £14,560 per annum, or £280 per week. All other income has always been liable to the levy, including income from occupational pensions.
The health contribution was introduced for the provision of medical and hospital services. The total income from the health contribution is paid into the Vote for the Department of Health and Children as an appropriation-in-aid and thus is applied to meet part of the cost of the health services supported by the State.
Although I have no plans to exempt occupational pensions from the health contribution, the threshold for the levy will be considered in the context of the budget.
