The Retail Export Scheme enables visitors that are resident outside the EU benefit from VAT relief on goods purchased in Ireland and subsequently taken outside of the EU. Under existing rules, when the UK becomes a third country, visitors from Britain will be able to avail of the scheme. No minimum threshold currently applies in respect of expenditure on which VAT relief may be claimed.
The Bill as published provides that the value of qualifying goods must exceed €175 in order to be eligible for a refund under the scheme. This change is fully compatible with EU law and is in line with the EU VAT Directive. The Bill also introduces a requirement of proof of importation of the goods into the UK and the associated proof of payment, where applicable, of relevant UK VAT and duties, for the goods purchased under the scheme in order to qualify for a refund.
In recognition of the difficulties facing retailers, especially businesses in the tourism sector, I am bringing forward an amendment at committee stage to reduce the threshold to €75. This reduction retains protections for the exchequer while also acknowledging the potential impact that not making this change would have on retailers across the country at this difficult time.
With regards to extension of the scheme, there is no application or authorisation process involved in the scheme, as it is a self-assessment system. Retailers may operate the Retail Export Scheme in their own right or in conjunction with a Value-Added Tax (VAT) refund agent.