The Minister for Finance has agreed that it would be useful to circulate a discussion document on the proposed social charge, which is due to be introduced in the next Budget.

The social charge will combine PRSI and all the existing levies on income, and will apply to all income. The minister's intention is that everyone will make a contribution to social services, even at the very lowest level of income. He was speaking at an Oireachtas committee hearing on the Finance Bill.

Fine Gael's finance spokesman Richard Bruton said the social charge would be a new tax on 400,000 pensioners and 200,000 public servants.

He said this change was particularly important for pensioners, as all previous pension support schemes had been based on the assumption that pension income would be treated in a particular way. Mr Bruton said it now appeared that pensioners would have a levy in the same way as employed people.

He also said there were equity issues in the way the levy would be applied to public servants, as those recruited after 1995 are paid at a higher rate than those recruited before that date, but pay a higher rate of PRSI.

Earlier, an amendment to the Finance Bill calling for companies which make donations to political parties to be ineligible for any tax relief arising from the International Financial Services Centre (IFSC) was ruled out of order. The amendment, in the name of Labour's Joan Burton was ruled out of order by committee chairman Michael Ahern of Fianna Fáil.