asked the Minister for Finance if he agrees that the VAT on point of entry on all goods being imported into this country is contributing to the closure and liquidation of a large number of firms, if he realises that many firms cannot import spare parts for storage here because of this tax until such time as existing stocks have been sold and paid for resulting in long delays for firms being able to supply their customers, particularly small firms, and if he will make a statement on the matter.
Written Answers. - Value-Added Tax.
105.
I accept that the VAT at point of entry system, introduced in 1982, can create problems for industry and business generally. The Government are, however, committed to resolving these problems as soon as possible. The exemption for raw materials imported by exporting firms, which I introduced in 1983, has been of considerable assistance in this regard. The VAT at imports system has no direct bearing on the cost of maintaining stocks as VAT on business inputs is generally deductible in the VAT return for the period during which stocks were imported, irrespective of when the goods are subsequently sold.