Dermot Ahern
Ceist:83 Mr. D. Ahern asked the Minister for Finance the plans, if any, he has to abolish VAT on life saving equipment in view of recent tragedies at sea; and if he will make a statement on the matter. [6528/96]
Written Answers. - VAT Law.
The position is governed by EU VAT law with which Irish VAT law must comply. The introduction of new zero rates is forbidden. Nor would reduced rating be an option: the items in question are not on the reduced rate list in the Sixth EU VAT Directive; nor were they at a reduced rate here on 1 January 1991 (in which case a reduced rate could legally be applied on a temporary basis). Any attempt by Ireland to apply a zero rate or a reduced rate to safety equipment, which is currently at the standard rate of 21 per cent would be open to challenge in the European Court of Justice.
However, VAT-registered fishermen would be able to recover any VAT borne on safety equipment in their normal VAT returns. Commercial fishermen who are not registered are, nevertheless, generally able to recover the VAT borne on safety equipment in accordance with regulations made under the VAT Act.