Terence Flanagan (Dublin North East, Independent)
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25. To ask the Minister for Finance the position regarding the payment of the universal social charge (details supplied) in Dublin 9; and if he will make a statement on the matter. [10373/14]

Michael Noonan (Limerick City, Fine Gael)
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The Universal Social Charge (USC) was introduced in Budget 2011 to replace the Income Levy and the Health Levy. It was a necessary measure to widen the tax base, remove poverty traps and raise revenue to reduce the budget deficit. It is a more sustainable charge than those it replaced.  It is applied at a low rate on a wide base.  The revenues collected play a vital part in meeting the many expenditure demands placed on the Exchequer.

As you may be aware, delivering on a commitment in the Programme for Government, the USC was reviewed by the Department of Finance in the lead up to Budget 2012. The report is available at;

 As a result of the review of the USC, the Government decided in Budget 2012 to increase the entry point to the Universal Social Charge from €4,004 to €10,036 per annum. It is estimated that this removed almost 330,000 individuals from the charge.  

It should be acknowledged that Ireland has a progressive taxation system which ensures that the burden of taxation falls most heavily on those with a higher ability to pay. The latest data from the OECD's 2013 Tax Wages Report shows that Ireland has one of the most progressive income tax systems in the developed world. Currently it is estimated that 856,000 workers are excluded from the charge to income tax entirely.

In keeping with normal practice I have no intention of setting out planned changes to the tax system in advance of the Budget, which is almost eight months away. However, as is also normal practice, my officials will model and examine potential options for changes to the tax system for my consideration as part of the overall Budget package.