Dáil Éireann debate -
Wednesday, 31 May 1995

Vol. 453 No. 7

Written Answers. - VAT Liability.

Noel Ahern

Question:

69 Mr. N. Ahern asked the Minister for Finance if he will introduce a system whereby medical equipment and appliances, duly certified and recommended by a medical practitioner, can be supplied free of VAT to individual purchasers; if the scheme would be in accordance with EU VAT rules; and if not, the way in which it is applied in the UK. [10020/95]

Minister for Finance (Mr. Quinn)

I presume that the Deputy is referring to equipment and appliances bought for the personal use of individuals. The general position is that, under EU VAT law, medical equipment and appliances are liable to VAT. However, member States which applied zero rates to such items on 1 January 1991 may continue to do so for a transitional period, that is, until end 1996, at least. This appears to be the operational basis of the UK system of relief to which the Deputy refers: it involves the zero-rating of goods to individual purchasers where they can satisfy the retailer that they are disabled persons entitled to the relief. As the creation of new zero rates is prohibited by EU law, it is not open to Ireland to introduce a similar scheme at this stage.

However, I should explain that a number of special arrangements have applied here for several years which have the net effect of removing VAT on many medical appliances and items of equipment for personal use. Firstly, the zero rate of VAT currently applies to wheelchairs and other invalid vehicles (excluding mechanically propelled road vehicles), orthopaedic appliances, surgical belts, trusses and the like, deaf aids, artificial limbs, walking frames and crutches. Secondly, under the terms of VAT Refund Order No. 15, an amount equivalent to the VAT borne on appliances and aids which assist disabled persons to overcome their disability in the performance of daily functions or the exercise of a vocation, may be refunded on application to the Revenue Commissioners. For the purpose of this scheme, the term disability is defined in broad terms to include loss of physical or mental faculty due to injury, disease, congential deformity or physical or mental illness or defect. A very broad range of items is eligible for refund under this scheme, including radar devices for the blind, renal haemodialysis units, dialysis machines and artificial respirators. The scheme is administered by the Revenue Commissioners and it is a matter for them to determine whether or not a particular item is eligible for refund. Finally, of course, medical card holders are generally entitled to receive medical appliances and aids free of charge.

The existing arrangements outlined above in relation to medical aids and appliances are, therefore, wide ranging and I believe that they are of significant assistance to persons requiring such equipment. I do not intend to make any amendments to them at this stage.