Dáil Éireann Debate, Tuesday - 9 June 2020
48. Deputy Michael McGrath asked the Minister for Finance further to Parliamentary Questions Nos. 104, 105 and 112 of 20 May 2020, if it is permissible under EU rules to zero rate VAT for medical equipment for dentists and shops which provide PPE freely to their employees; and if he will make a statement on the matter. [9655/20]
View answer77. Deputy Michael McGrath asked the Minister for Finance if under existing EU rules and decisions, the zero rate of VAT can apply to businesses for as long as they are distributing personal protective equipment to their employees free of charge; and if he will make a statement on the matter. [10321/20]
View answerI propose to take Questions Nos. 48 and 77 together.
I outlined previously in my answer to Parliamentary Question Nos. 104, 105 and 112 of 20 May 2020 the VAT rate changes implemented by Revenue following the European Commission Decision C (2020)2146, adopted on 3 April 2020. These changes fully implemented the scope for zero rating imports of COVID-19 related goods permitted by the Decision and also implemented a corresponding temporary zero rating of similar, specified domestic supplies. Any further extension of zero rating to cover supplies of medical equipment and/or personal protection equipment to dentists and shop owners and indeed other sectors and businesses would require a change in legislation at EU level; the VAT Directive would not permit a legislative measure for the application of the zero rate of VAT to such supplies and there are no grounds in the Commission Decision that would support the adoption of such a measure, even on a temporary basis.
The Deputy will be aware that businesses such as shops which are registered for VAT and incur VAT in relation to goods which will be used for the purposes of the taxable business are entitled to reclaim the VAT incurred through their VAT return.
