Denis Naughten
Question:174 Mr. Naughten asked the Minister for Finance if he will introduce measures which will allow charities to reclaim VAT; and if he will make a statement on the matter. [14353/02]
Written Answers. - Tax Rebates.
I am aware of the campaign currently being run by the Irish Charities Tax Reform Group, who are seeking a refund of all the VAT incurred by them. The current VAT treatment of charitable organisations is based on EU VAT law, with which Irish law must comply. Under the Sixth EU VAT Directive, a wide range of charitable and voluntary activities are exempt for VAT purposes. This means that the organisations involved do not charge VAT on their services but, as a necessary corollary, they are unable to recover the VAT they bear on the goods and services they purchase in the course of their activities. It is unlikely that the cost would be limited to the €63 million claimed by that group. Given that there are no provisions for refund orders under EU law, as well as the cost involved, I have no plans to introduce any measures to allow charities to reclaim VAT.