asked the Minister for Finance if he will make a statement concerning the proposed application of the value added tax to the livestock trade and the various representations received by him on this matter.
Written Answers. - Value Added Tax.
172.
Value added tax will apply to sales of livestock, and any person dealing in livestock may register for tax purposes in the same way as any other trader. A registered person will get full relief for any tax borne by him on his purchases and will be able to pass on a credit for the tax on his sales when he sells to another registered person.
It is expected that the great majority of those engaged in the livestock trade will not opt to register. Arrangements are being worked out whereby the producers, with a minimum of record keeping, will be fully compensated for the tax element in their purchases.
Representations have been received (1) that livestock dealers and marts should be relieved of the obligation of accounting for tax on their sales; (2) that a zero rate of tax should apply to all farm inputs; and (3) that the introduction of the tax should be postponed for at least one year. The methods to be adopted regarding accounting for tax on sales of livestock by unregistered persons are being discussed between the Revenue Commissioners and the interested parties, and it is hoped that a satisfactory arrangement can be worked out. The zero rating of farm inputs is not feasible because it would change the tax from one of general application to a selective tax on a restricted range of articles. Such a system would not be feasible in the circumstances of this country; and it would not be acceptable in the EEC. It is intended to adhere as closely as possible to the proposed commencement date of January 1st, 1972, and I am not satisfied that the arguments put forward are sufficient to justify postponement for a year.