Wednesday, 25 January 2012

Questions (62, 63)

Peadar Tóibín

Question:

57 Deputy Peadar Tóibín asked the Minister for Finance the revenue raised through the VAT on taxi booking facilities, radio hire and administration for the past year. [4242/12]

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Peadar Tóibín

Question:

58 Deputy Peadar Tóibín asked the Minister for Finance if he will consider a change to the VAT on taxi booking facilities, radio hire and administration for the past year in view of the fact that it is a labour intensive industry and an important aspect of the hospitality industry. [4243/12]

View answer

Written answers (Question to Minister for Finance)

I propose to take Questions Nos. 57 and 58 together.

The Deputy is referring to services on which a taxi operator incurs VAT. These services (taxi booking service, hire of radios and the provision of administration) are liable to VAT at the standard rate of 23%. The transport of passengers and their accompanying baggage is exempt from VAT under Paragraph 14(3) of Schedule 1 to the Value-Added Tax Consolidation Act 2010. Accordingly, the provision of a taxi service is exempt from VAT. This is in contrast to the 9% reduced rate of VAT that applies to many services in the hospitality sector.

While the provider of a service that is exempt from VAT does not charge VAT on the service they supply, they are also not entitled to deduct, or claim a refund of, any VAT incurred on goods and services used for the purposes of their exempt business. Thus, a person who provides a taxi service does not register for VAT and cannot recover VAT incurred on costs associated with running their business, such as taxi booking services, the hire of radios and the provision of administration.

In relation to the revenue raised through the VAT on taxi booking facilities, radio hire and administration for the past year, I am advised by the Revenue Commissioners that the information sought by the Deputy is not directly available from the data maintained by them.