The Treasury's decision followed a consultation in March that proposed an NHS Levy that would raise ringfenced income tax for health services subject to a maximum charge of £5,000 for individuals and £10,000 for those jointly assessed.

Treasury minister, Dr Alex Allinson MHK, said: ‘The increased financial and demand pressures on our health and social care services are well documented and the island is clearly not alone in examining how it can sustain vital frontline services into the future.

‘The consultation gave us the opportunity to gauge public appetite following a commitment in the 2024 Budget and associated Tax Strategy to look at additional ring-fenced income to fund these services.'

The minister continued: ‘While cost pressures clearly affect a number of departments that provide essential public services, as reported in the most recent Quarterly Management Accounts, the Treasury is working with DHSC and Manx Care on a specialist Financial Recovery Programme. This is designed to complement the existing Cost Improvement Programme, drive better value for money and deliver reform through the expansion of community services.

‘Questions and concerns regarding any proposed new NHS funding stream were inevitable, and the consultation has been useful in clarifying thinking that will help inform options in the future.'

During a recent Government conference, the Treasury said income was ahead of expectations due to the resilient local economy, with taxation receipts ahead of predictions. It was also revealed that Government Reserves remained on a recovery path following the successful implementation of a new investment mandate.