Dáil Éireann Debate, Tuesday - 15 February 2005
262 Mr. Ferris asked the Minister for Finance if, in view of the decision by the EU Commission to allow the UK and Germany to waive excise duties on biofuels, if a similar request will be made from this State. [4579/05]
View answer270 Mr. Ferris asked the Minister for Finance if the European Commission has approved the proposals made in March 2004 to allow the introduction of excise relief for the production of biofuels. [4895/05]
View answerI propose to take Questions Nos. 262 and 270 together.
My Department, following consultation with the Department of Communications, Marine and Natural Resources, has submitted a formal application for Commission approval for a scheme which allows excise relief for pilot projects in the biofuels area, including pure plant oil, biodiesel and bioethanol. The EU Energy Tax Directive (2003) envisages such tax relief and the Commission has approved schemes for excise relief on biofuel in other EU member states. Assuming approval is granted, the necessary commencement order will then be signed.
263 Mr. Haughey asked the Minister for Finance if he will exempt the over 80s from paying 21% VAT on phone, gas and electricity bills; and if he will make a statement on the matter. [4660/05]
View answerThe rate of VAT that applies to a particular good or service is determined by the nature of the goods or service, and not by the status of the customer. Telecommunications services including phones are subject to the standard rate of VAT at 21%. The supply of electricity and gas is subject to the reduced VAT rate of 13.5%. There is no provision in European VAT law, with which Irish VAT law must comply, that allows the application of an exemption from VAT for supplies to customers over the age of 80.
However, under the social welfare code, any person resident in the State who is aged 70 or more is entitled to the social welfare household benefits package, subject to certain conditions and regardless of income or household composition. This package comprises an electricity or natural gas or bottle gas allowance, a telephone allowance, and a free television licence.
The electricity allowance covers the normal standing charge and up to 1,800 units of electricity each year. At current prices, the value of the electricity allowance to the consumer is approximately €339 per annum for urban dwellers, and €381 for rural dwellers, inclusive of VAT at 13.5%. Alternatively, if the natural gas allowance option is selected, the customer is entitled to the supply charge and up to 1,674 kwh of gas per year. The annual value of this is up to €250 per annum, inclusive of VAT at 13.5%. If the person's home is not connected to an electricity or natural gas supply, the person is entitled to 15 cylinders of bottle gas per annum at an annual value of approximately €320, inclusive of VAT at 13.5%.
The telephone allowance is paid as a credit on the customer's telephone bill. The value of the allowance is €24.70 per month, including VAT, or €296.40 per annum.
264 Mr. McCormack asked the Minister for Finance if, in view of the new regulations concerning the compulsory provision of safety equipment on small craft fishing vessels, he will introduce regulations to have a zero VAT rate for the purchase of safety equipment for mountain rescue, lifeboats, coastal search and rescue and small fishing vessels; and if he will make a statement on the matter. [4662/05]
View answer265 Mr. McCormack asked the Minister for Finance if he will introduce regulations to reduce the VAT rate from 21% to the reduced rate of 13.5% for safety equipment which must now be installed on all small fishing vessels. [4663/05]
View answerI propose to take Questions Nos. 264 and 265 together.
The VAT rating of goods and services is subject to the requirements of EU VAT law, with which Irish VAT law must comply. While we can maintain the zero rating on those goods and services which were zero-rated before 1 January 1991, the goods and services referred to by the Deputy do not fall within this category. Similarly, member states may only apply a reduced VAT rate to those goods and services set out in annexe H of the EU Sixth VAT Directive. Safety equipment is not included in this annexe. Therefore, it is not possible to apply a zero or reduced VAT rate to these goods and services.
However, fishermen who are registered for VAT are entitled to claim a refund for all VAT charged to them in respect of equipment used for their business. Fishermen who are not registered for VAT are entitled to claim in respect of certain inputs, under section 29, regarding remission or repayment of tax on fishing vessels and equipment, of the 1979 VAT regulations. In the case of safety equipment, the inputs included are anchors, autopilots, bilge and deck pumps, buoys, floats, compasses, life boats and life rafts, marine lights, radar apparatus, radio navigational aid apparatus, radio telephones, provided the vessel concerned has been the subject of a grant or loan from Bord Iascaigh Mhara.
In addition, the Value-Added Tax (Refund of Tax)(No. 18) Order 1985 provides for the repayment of VAT, subject to certain conditions, incurred in respect of equipment for use in rescue or assistance at sea. Furthermore, the 1973 Finance Act provided for the zero-rating of "life saving services provided by the Royal National Lifeboat Institution, including the organisation and maintenance of the lifeboat service". This means that while the RNLI does not charge VAT on the services it provides, it is entitled to reclaim VAT incurred on the goods and services which it purchases in delivering those services.
The Irish Coast Guard, under the aegis of the Department of Communications, Marine and Natural Resources, administers the community Inland and inshore rescue services grant scheme. The Community of Inshore Rescue Services and the Inland Rescue Service may apply for grants under the scheme in respect of both current and, more recently, capital expenditures. Guidelines on the scheme in terms of eligibility criteria and grant levels are available from the Irish Coast Guard.
