Barry Andrews (Dún Laoghaire, Fianna Fail)
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Question 134: To ask the Tánaiste and Minister for Health and Children the reason losses are not allowable against profits in calculating income levies; and if she will make a statement on the matter. [36790/05]

Mary Harney (Dublin Mid West, Progressive Democrats)
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Section 4 of the Health Contributions Act 1979 states: "There shall be paid, subject to and in accordance with this Act and regulations under this Act, by or in respect of each individual who is over the age of sixteen years, contributions . . . towards the cost of the provision of services under the Health Acts, 1947 to 1978." Further section 7, as amended, provides for the payment of health contributions by individuals with "reckonable income . . . in any contribution year".

The definition of "reckonable income" for the purposes of the collection of health contributions mirrors that as set down by existing social welfare legislation. As defined in section 6, amended, of the Health Contributions Regulations and further in the Social Welfare (Consolidation) Act 2005, "reckonable income means, in relation to an individual, the income aggregate of the individual's income from all sources for the contribution year as estimated in accordance with the provisions of the Income Tax Acts" without regard to various sections of the Taxes Consolidation Act 1997. This definition does not include any provision for losses.

Health contributions are, therefore, calculated on all reckonable income in that contribution year and there is no provision for losses carried forward from a previous year to be deducted in this calculation. This approach, which supports the principles underpinning the social insurance system, is the same as that taken in relation to the calculation of liability for PRSI.