Dáil Éireann Debate, Thursday - 16 December 2021
243. Deputy Violet-Anne Wynne asked the Minister for Finance if the VAT on farming equipment can be reduced, for example, on slurry equipment to incentivise and make more viable the farming profession. [62714/21]
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 accordance with Irish legislation, agricultural equipment is liable to VAT at the standard rate, currently 23%. There is no discretion under the Directive for Ireland to reduce the rate of VAT on these goods.
Farmers may elect to register for VAT or be treated as flat-rate farmers for VAT purposes. Farmers that are registered for VAT have an entitlement to reclaim VAT charged on costs incurred in relation to the farm business, including VAT borne on the purchase of agricultural equipment such as slurry equipment.
Farmers who are not registered for VAT are entitled to avail of the Flat-Rate Farmers Scheme which compensates them for the VAT incurred on goods and services used in the course of their farming business by allowing them to charge a flat rate addition for their supplies of agricultural produce and services. This long-standing arrangement is provided for under Ireland’s VAT legislation and is permitted under the Directive.
