asked the Minister for Finance his views on whether there is unnecessary duplication in the case of collection of VAT at point of entry and that this duplication is causing considerable hardship to many sectors of industry; and if he will consider amending the regulation whereby the collection of VAT on deposits for goods prior to importation can be dispensed with.
Written Answers. - Duplication of VAT Charges.
103.
I do not accept that VAT charged in the circumstances outlined causes unnecessary duplication or considerable hardship.
With regard to the details supplied by the Deputy with his question I would like to explain that two aspects of the VAT system, which are distinct and separate in their operation, are involved. VAT at point of entry is a special feature of the VAT system applying to importers. It becomes payable by virtue of the physical act of importation and without reference to whether or not a deposit has been paid. The importer is placed under no greater disability in such instance than if a deposit had not been paid. The VAT treatment of deposits is part of the normal rules which apply to sales of goods by traders. Thus a company receiving a prepayment is obliged under law to account to the Revenue Commissioners for the VAT due thereon and is in a position to charge this VAT to the customer. It would be impracticable to amend the existing arrangements in the manner requested.