Furious opposition forces changes to USC

MINISTER for Finance Brian Lenihan was forced to make a concession on the contentious Universal Social Charge (USC) following mounting anger amongst independent TDs, opposition parties and the public.

Amendments were made to the Finance Bill yesterday following demands by independent TDs, Michael Lowry and Jackie Healy-Rae, and after radio stations were dominated by callers raging at the “injustice” of the USC.

Fine Gael and the Labour Party have both stated their opposition to the charge. The Office of the Revenue Commissioners has admitted that one in four telephone calls relate to the impact of the new charge.

A lower rate is to be introduced for medical card holders, who will no longer be subject to the 7% rate over €10,000, but will pay 4% instead.

However, self-employed people will pay an extra 3% surcharge on incomes over €100,000.

The charge, introduced in the budget, amalgamated the health and income levies and anyone earning over €4,004 will pay 2% USC, while those on incomes over a meagre €16,016 will be hit with 7%. A 4% charge will come into effect on incomes from €10,037 to €16,016.

Galway East candidate, Senator Fidelma Healy-Eames joined the clamour by speaking out on behalf of a 35-year-old professional who was disabled eight years ago following a brain haemorrhage stemming from a hospital-based MRSA infection.

Despite continuing to work, the single woman, who is now partially blind, won’t be able to pay for physiotherapy as she’s down €400 a month, thanks to the new levy.

Physiotherapy is vital as she is paralysed on her left side and needs to retain maximum mobility for work.

“She has managed to continue working by funding physiotherapy and counselling for herself. Now with a €400 cut to her monthly income, as a result of the scrapping of exemptions for medical card holders, her future is becoming increasingly unclear. She told me that she’s on the verge of a nervous breakdown and can’t sleep with the effect of this,” Senator Healy-Eames said.

Last night, the Labour Party accused Minister Lenihan of acting in “such an underhand way” in introducing the USC.

“There was no White Paper, no consultation document that would have allowed this new tax to be subject to preliminary discussion and scrutiny because it is no more than a tax by another name. I accept that the Minister has today relented in agreeing a small concession for those with medical cards, although I wonder whether this has more to do with swaying members of the Fianna Fáil parliamentary party than with easing the burden on taxpayers,” she said.