The VAT rating of goods and services is subject to the requirements of EU VAT law with which Irish VAT law must comply. In this regard, all digitised publications, including e-books are treated as the supply of a service liable at the standard rate of VAT, which in Ireland is 23%. While Ireland applies a zero VAT rate to printed books including atlases, children's picture, drawing and colouring books and books of music, by virtue of a derogation under the VAT Directive for such exceptional treatment, there is no option under EU VAT Law to either exempt e-books from VAT or to apply the zero VAT rate or a reduced VAT rate to such products.
The different VAT treatment of printed books and e-books reflects the nature of these products, the latter being a richer product often providing content beyond simple text to include embedded digital music, software, film and internet links. While it is possible to reduce the standard rate on e-books to below 23%, such a reduction would, under EU VAT Law, have to apply to all goods and services at the standard VAT rate, which would be excessively costly to the Exchequer.