Dáil Éireann Debate, Tuesday - 13 June 2023
384. Deputy Rose Conway-Walsh asked the Minister for Finance if medical card recipients are required to apply for the reduced USC, or if the reduction is applied automatically; the total number of medical card recipients getting a reduced USC rate; and if he will make a statement on the matter. [28052/23]
View answerThe position is that individuals who hold a full medical card with total income of €60,000 per annum or less benefit from reduced rates of USC. To qualify for the reduced USC rates the individual does not need to hold the medical card for the full year, the reduced rates apply once the individual holds a full medical card for any period during the year. The reduced rates of USC that apply for 2023 are 0.5 per cent on the first €12,012 of income and 2 per cent on the balance. Taxpayers that can avail of this concession are not subject to the 4.5 per cent USC rate of charge, as would be the case for all other taxpayers.
It is important to point out that the concession for medical card holders was never intended to be a permanent feature of the USC. Instead, it was planned to phase in the full USC charge for medical card holders via a transitional approach. This concession for medical card holders has been extended on a number of occasions, most recently in Budget 2023, with an extension of the concession until 31 December 2023. In advance of Budget 2023, my Department carried out a review of this concessional treatment having regard to the Department’s Tax Expenditure Guidelines and the resultant report is available at the following link: www.gov.ie/pdf/?file=https://assets.gov.ie/236747/7cf040e6-c9f4-4f06-8190-8637dc435a12.pdf#page=null
I am advised by Revenue that the estimated number of individuals in 2020 who availed of the reduced rates of USC for individuals who earn €60,000 or less and are full medical card holders is approximately 108,000. Data for later years will be available once tax returns for those years are filed and processed and available for analysis. I am further advised that Revenue are provided with data from the HSE identifying the taxpayers who are in receipt of a medical card and automatically apply the reduced rate to eligible persons.
