Dáil Éireann debate -
Wednesday, 11 Apr 2001

Vol. 534 No. 4

Written Answers - Tax Code.

Noel Ahern

Question:

124 Mr. N. Ahern asked the Minister for Finance his views on the small increase in the health levy exemption limit in 2001; if his attention has been drawn to the way this affects those on private occupational pensions, particularly those near the income threshold who have suffered a loss of income in 2001 as their pension increases have put them into the levy payment zone, resulting in a net decrease of income over the year; and if he will offer any hope of improvement in this regard. [11068/01]

Minister for Finance (Mr. McCreevy)

The position is that the low income threshold for the health contribution, below which the levy is not payable, is currently £14,560 per annum or £280 per week, as amended by the Social Welfare Act, 2000. The weekly income threshold will remain unchanged at £280. Arising from the change in the tax year to a calendar year basis, the annual threshold will be £10,775 for the 2001 short tax year, i.e. 74% of the current threshold of £14,560. I have no plans to adjust either of the thresholds involved at this point. However, I will bear in mind the issues raised by the Deputy in the con text of the continuing reform of the PRSI and levies arrangements which I intend to introduce in my next budget.

The Deputy will be aware that the reductions in personal taxation made in budget 2001 provided substantial increases in net incomes, including for those on occupational pensions. The entry point to the tax system was increased to £144 per week for single persons and an additional 133,000 persons were removed from the tax net.