Vol. 461 No. 7
117 Mr. Lawlor asked the Minister for Finance if he will consider granting VAT exemption to a national charity (details supplied) similar to the exemption granted in relation to the DIRT tax; and if he will make a statement on the matter. [3757/96]
The VAT treatment of charities is a direct consequence of EU VAT law. The Sixth VAT Directive, with which Irish law must comply, provides that most charitable activities are exempt from VAT: this means that bodies engaged in such activities do not charge VAT on the services that they provide but, as a necessary corollary, neither are they entitled to recover the tax borne on the goods and services they purchase in the course of these activities. Generally speaking, VAT can only be recovered by VAT-registered businesses.
