Dáil Éireann Debate, Tuesday - 24 July 2018
163. Deputy Jim O'Callaghan asked the Minister for Finance the reason injectable medicines here are subjected to a VAT rate of 23% in view of the fact there is no VAT on oral medicines; and if he will make a statement on the matter. [33885/18]
Amharc ar fhreagraThe VAT rating of goods and services is subject to the requirements of EU VAT law, with which Irish VAT law must comply. Under Irish VAT law the supply of injectable medicines is liable to VAT at the standard rate of 23%, while the zero rate of VAT applies to oral medicines.
Ireland’s application of the zero rate to oral medicines derives from an historical derogation to the normal VAT rules under Article 110 of the EU VAT Directive. Under that provision, Ireland may retain the zero rate on goods and services that applied at that rate on and since 1 January 1991. As oral medicines were subject to the zero rate of VAT on that date, Ireland may continue to apply the zero rate but may not extend its scope. As the zero rate of VAT did not apply to the supply of injectable medicines on that date, in accordance with the Directive, the zero rate cannot be applied now.
