Wednesday, 30 January 2019

Questions (86, 87, 90)

Brendan Griffin

Question:

86. Deputy Brendan Griffin asked the Minister for Finance his views on a matter (details supplied); and if he will make a statement on the matter. [4501/19]

View answer

Michael Healy-Rae

Question:

87. Deputy Michael Healy-Rae asked the Minister for Finance if a matter relating to VAT charged on products (details supplied) will be clarified; and if he will make a statement on the matter. [4507/19]

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Martin Heydon

Question:

90. Deputy Martin Heydon asked the Minister for Finance the position regarding VAT on food supplements, vitamins and minerals; his plans to impose a 23% VAT rate on such products; and if he will make a statement on the matter. [4521/19]

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Written answers (Question to Finance)

I propose to take Questions Nos. 86, 87 and 90 together.

The standard rate of VAT applies to food supplements. However, a Revenue Commissioners concession allowed the zero rate to be applied to certain types of vitamins, minerals and fish oils. Revenue has since decided to remove this concession with effect from 1 March 2019 so that all food supplements will be charged at the standard VAT rate.

It should be noted, however, that human oral medicines, including certain folic acid and other vitamin and mineral products, licenced by the Health Products Regulatory Association will continue to apply at the zero rate of VAT. Infant foods will also continue to be zero rated.

The operation of the concession became extremely problematic as a result of efforts by certain businesses in the industry to extend the concession beyond the scope permitted. Consistent challenges to Revenue guidance and decisions on the VAT rating of products gave rise to serious concerns about compliance within the industry and unfair competition between compliant and non-compliant businesses.

However, independent of Revenue’s decisions on interpretation, I agreed during the recent Finance Bill to put in place a process that will conclude in the 2019 Tax Strategy Group Paper to examine some of the policy choices around the VAT treatment of food supplements.