Dáil Éireann díospóireacht -
Tuesday, 8 Oct 1996

Vol. 469 No. 5

Written Answers. - VAT on School Supplies.

Michael P. Kitt

Ceist:

82 Mr. M. Kitt asked the Minister for Finance if there are any VAT reductions or VAT exemptions to primary school boards of management in respect of the purchase of school supplies, such as fittings for holding shoes and mats, the provision of playing facilities, such as ball courts and the provision of other school equipment. [17881/96]

Minister for Finance (Mr. Quinn)

The position is that the VAT treatment of schools and school equipment is laid down in EU VAT law, with which Irish law must comply. Under the EU Sixth VAT Directive, education is designated as an exempt activity. This means in effect, that schools do not charge VAT on the services they provide, but, as a necessary corollary, they cannot recover the VAT they bear on the goods and services which they purchase in the course of their activities. Generally speaking, VAT can only be recovered by registered businesses.

Most goods and services purchased by schools are taxed at the standard rate of 21 per cent. However, building work carried out by schools, in common with construction generally, is taxed at the reduced rate of 12.5 per cent.

Finally, I should point out that the level of Exchequer grants paid to schools and other educational establishments takes account of their VAT exempt status.