Tax breaks for GPs could drive development of primary care

Targeted tax incentives should be provided for GPs to encourage them to develop primary care centres or to invest in primary care specialised equipment, a consultants' report for the Department of Health has urged.

However the document, compiled by consultants Indecon, recommends that tax incentives for passive investors in primary care centres should not be allowed.

An analysis of potential measures to encourage the provision of primary care facilities, published on Friday by the department, stated that the evidence suggested a strong case for support for expanded primary care services.

“We believe there will be resultant benefits in terms of lower costs of healthcare and improved health outcomes if there is an effective expansion of primary care provision. We believe this should be given much higher priority in national policy.”

The Indecon report recommended “a multifaceted approach involving HSE-leased or built centres, GP-led primary care centres and incentives for GPs to invest in equipment”.

It said there was a rationale, subject to State aid approval, for properly targeted tax incentives for GPs to develop primary care centres or to invest in primary care specialised equipment.

Investments

The report noted that in the past there had been costly and inappropriate tax incentives for various investments. And it urged that great care be taken in considering any any new incentives in any sector.

“However, the case for targeted action in this area is soundly based and could significantly reduce exchequer costs and enhance health outcomes.”

The document urged that tax incentives for passive investors in primary care centres should not be permitted.

“Incentives for GP-owned centres would achieve the same results but at lower exchequer costs. Incentives for passive investors would also open up opportunities for higher income investors to shelter taxable income.

“The analysis undertaken in this report supports a recommendation for the Strategic Investment Fund (or some subset or variation of that Fund) to consider the provision of financing for primary care centres. The use of the fund to provide financing, in tandem with a tax incentive scheme to encourage GPs to invest in primary care facilities, is likely to have positive economic and health outcomes.”