VAT Rate Application

Dáil Éireann Debate, Tuesday - 6 May 2014

Tuesday, 6 May 2014

Ceisteanna (172)

Seán Kyne

Ceist:

172. Deputy Seán Kyne asked the Minister for Finance if his attention has been drawn to the recent decision by the Revenue Commissioners to implement a full 23% VAT rate for herbal teas such as peppermint while a zero VAT rate continues to apply on black, white and green teas; if his attention has been drawn to the fact that this decision is threatening the viability of indigenous companies, for example, one based in Galway, in terms of competing with UK-based companies; and if he will make a statement on the matter. [20317/14]

Freagraí scríofa

Minister for Finance

I am advised by the Revenue Commissioners that the zero rate of VAT applies to tea, which is understood to mean products in non-drinkable form which consist of the dried crushed leaves of the tea plant, but not products such as herbal and fruit based infusions, which are not derived from leaves of the tea plant.  Industry representatives raised this matter recently with my Department and with Revenue and I understand that the industry will make a submission on the matter in the near future. I am also advised that Irish suppliers are not at a competitive disadvantage to suppliers from the UK as Irish VAT applies to all supplies in the State irrespective of their country of origin.