Dáil Éireann Debate, Tuesday - 23 June 2020
47. Deputy Peter Fitzpatrick asked the Minister for Finance if he has the power to amend the Value-Added Tax (Refund of Tax) (Touring Coaches) Order 2012, SI No. 266 of 2012, to the extent that such an amendment would allow for input VAT recovery associated with the purchase of fuel, spare parts, repairs and tolls by bus and coach operators; and if he will make a statement on the matter. [11856/20]
View answerI am advised by Revenue that the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the VAT Directive provides that all goods and services are liable to VAT at the standard rate, currently 23% in Ireland, unless they fall within categories of goods and services specified in the Directive, in respect of which Member States may apply a lower rate or exempt from VAT. In addition, the Directive allows for historic VAT treatment to be maintained under certain conditions and Ireland has retained the application of VAT exemption to the transport of passengers and their accompanying baggage. This means that the supplier does not register for VAT, does not charge VAT on the supply of their services and has no VAT recovery entitlement on costs where such costs are used for the exempt supply of passenger transport. However, Ireland has also maintained a relieving provision, the Value Added Tax (Refund of Tax) (Touring Coaches) Order of 2012, which provides for a refund of VAT on the cost of acquiring “qualifying vehicles” used for the carriage of tourists under contracts for group transport.
Extending the scope of the Order to engineer VAT recovery for bus and coach operators in respect of a range of business operating costs while maintaining VAT exemption would be contrary to the Directive.
