Dáil Éireann Debate, Tuesday - 24 July 2018
187. Deputy Noel Grealish asked the Minister for Finance his plans to reduce the VAT payable on sales of local and regional newspapers which are the highest rates in Europe to ensure the viability of a strong independent media; and if he will make a statement on the matter. [32944/18]
Amharc ar fhreagraThe VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. Ireland applies the second reduced VAT rate of 9% to the supply of printed newspapers. It is not possible under EU VAT law to distinguish VAT rating by regional location, hence it is not possible to apply a different VAT rate to newspapers supplied regionally or locally versus nationally.
Of the VAT rates applied to newspapers in the EU, Ireland applies the joint eight highest rate, alongside Estonia and Lithuania. Six Member States, including the UK, apply rates of VAT below 5% under an historic derogation, whereby they can retain this special VAT rating if it applied on and since 1 January 1991. Ireland’s zero rating of printed books falls into this category, but as we did not apply a zero rate or a rate of less than 5% to newspapers on and since 1991 it is not possible to introduce it now.
Three Member States apply their standard VAT rate of over 20% to newspapers but the majority of Member States apply a reduced VAT rate to newspapers of between 5% and 12%. It would be legally possible for Ireland to reduce the VAT rate on newspapers to 5% but in order to do so all activity at the 9% would have to be reduced to that rate at an estimated cost to the Exchequer of €470m.
