Dáil Éireann Debate, Wednesday - 13 March 2013
53. Deputy Maureen O'Sullivan asked the Minister for Finance in view of the fact that the universal social charge was introduced in budget 2011 to replace the income levy and health levy, the reason for both these levies and if this reason or purpose changed with the amalgamation and change of name in budget 2011; and if he will make a statement on the matter. [13227/13]
Amharc ar fhreagraThe position is that Universal Social Charge (USC) was introduced in Budget 2011 to replace the Income Levy and Health Levy. It was a necessary measure to widen the tax base, remove poverty traps and raise revenue to reduce the budget deficit. I should point out that the Health Levy was introduced in the Health Contributions Act, 1979 and was payable on all reckonable income and subject to certain exemptions. The Health Levy was collected along with PRSI contributions by the Revenue Commissioners. Under the legislation, it was paid into the Social Insurance Fund and transferred from there to the Minister for Health, where it was appropriated to the Health Vote as an appropriation-in-aid.
The Income Levy was introduced along with a suite of revenue raising measures in Budget 2009 in response to the economic downturn in order to assist in stabilising the country finances.
Payment of the Health Levy and the Income levy did not confer any entitlement or specific benefits to an individual. However, individuals in general do benefit from the services provided by the State.
Likewise, individuals that are subject to the USC charge do not accumulate entitlements or specific benefits.
