Simon Harris (Wicklow, Fine Gael)

I acknowledge the very constructive way Deputies Doherty and Cullinane are engaging on this issue. While I am not certain an amendment to the Finance Bill is the way to go about this, I am willing to work with them and maybe the relevant Oireachtas committee, at which I think Members had a decent discussion about this on Committee Stage. From listening to the two Deputies, I think they are pondering how best to address this issue. We have requested more information from the Department of Health because I accept there is a gap here.

Deputy Doherty made a fair point about living donors. Section 5 of the Finance Bill relates to compensation payable to a living donor of a kidney or part of a liver under conditions defined by the Minister for Health. This is a payment that is exempt from various taxations and the likes but it is a Department of Health scheme. The Deputies have been at this a long time, but these are generally schemes devised by parent Departments and then my Department advises or assists on the tax treatment piece of the schemes. It is not a matter of passing it to another Department, but it is a discussion for maybe the Department of Health and my Department to have together.

On the refundable tax credit - I say this to be helpful on an important matter - the Deputies will be aware that, in advance of budget 2024, the tax strategy group looked in its series of papers at the whole issue of refundable tax credits and outlined its concerns, not only about it being a fundamental change to the personal tax system but, on the other hand, that it would not necessarily assist as many people as we would like in the way we would hope. Based on that, I am not sure this is the best way to go.

The Deputies have already acknowledged that there is a tax relief available where an individual proves that he or she has incurred costs in respect of qualifying health expenses. Specifically for home dialysis patients, tax relief may be allowed in respect of the following expenses: electricity, laundry, protective clothing, telephone and travelling. The flat rates available for kidney dialysis patients are operated by Revenue on an administrative basis and are updated annually in line with the consumer price index. Relief is calculated on these flat rates at the standard rate of income tax. Separate to this administrative practice, an individual may claim for the actual vouched costs of healthcare necessarily incurred by them, subject to relevant conditions being met. That, however, is not the point the Deputies are making. The point they are making has to do with people who do not reach the threshold of actually paying tax. Once I get more specific information back from the Department of Health on home dialysis patients, we will forward that to the committee.

If taxpayer units with no income tax liability could claim tax relief in respect of health expenses incurred for home dialysis or other health expenses, it would effectively introduce a system of refundable tax credits. That is a debate to have. I think the Deputies are okay with that; we are not sure we are. It could open this up to many more areas. What would be the cost to the Exchequer and so on?

We have a bit of thinking to do on this. As was committed to on Committee Stage, the Department of Finance has sought clarification as to what direct expenditure supports are in place, or indeed could be put in place. Once we have that, I will immediately furnish it to the committee, and I am happy to engage on this further in the time ahead.

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