asked the Minister for Finance if, as part of the Government's energy conservation programme, he will remove the 20 per cent VAT on solar energy plant and component parts manufactured in Ireland.
Written Answers. - Energy Conservation Programme.
83.
I do not consider that a selective adjustment in the VAT system on the lines suggested would be an appropriate means of promoting energy conservation. The Deputy may wish to know, however, that the total labour and materials cost of installing a solar energy or other fixed heating system by a VAT registered contractor would normally be liable to VAT at the effective rate of 3 per cent regardless of the rates applying to the materials used.
The 3 per cent rate would not apply if the cost of materials supplied exceeded two-thirds of the total price of the work. In such cases the 20 per cent rate would apply.
EEC commitments would preclude the operation of VAT in a way which would make distinctions by reference to the place of manufacture of goods.