Dáil Éireann Debate, Tuesday - 4 November 2014
270. Deputy Stephen S. Donnelly asked the Minister for Finance in view of the most recent cuts to school budgets which have resulted in principals in County Wicklow indicating they may not be able to heat their school for every day of term over the winter months, his views on making schools exempt from VAT to assist with purchasing fuel, and so on; and if he will make a statement on the matter. [40984/14]
View answerI would point out that schools are and always have been exempt from VAT. Paragraph 4(3) of Schedule 1 to the VAT Consolidation Act 2010 provides an exemption from VAT for the provision of children or young people's education by establishments recognised by the State. Irish VAT law is guided by the EU VAT Directive, with which it must comply, and this provision mirrors Article 132, paragraph 1(i) of the VAT Directive, which provides that EU Member States must exempt from VAT such education.
VAT exemption is where a person is not required to charge VAT on any services or goods they supply, while not being entitled to claim back any VAT paid on the costs associated with their business. As schools are exempt from VAT they are not entitled to claim back VAT on purchases related to the running of schools, such as fuel. It is not possible under Irish or EU VAT law for schools to make a claim for the VAT they incur on their inputs.
