The VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In accordance with the Directive, defibrillators, other than implantable defibrillators, are liable to VAT at the standard rate, currently 23%. Annex III of the Directive specifies categories of goods and services in respect of which Member States may apply a reduced rate of VAT but as defibrillators are not included in any of those categories there is no discretion for Ireland to apply a reduced rate of VAT to their supply.
In 2016 the Commission published a VAT Action Plan that set a path towards the modernisation of VAT in the EU and, in October 2017, published a proposal, an Impact Assessment and a Communication on the definitive VAT regime.
Since then, the Commission has published a significant number of legislative proposals in the field of VAT, including one on VAT rates which proposes that Member States would continue to apply a standard VAT rate of at least 15% as well as retaining the option to apply a number of reduced rates and a zero rate. The purpose of the VAT rates proposal is to allow Member States more flexibility in how they apply VAT rates. It also allows Member States to maintain reduced rates and certain exemptions and proposes that these will be available to other Member States, ensuring equal treatment.
This proposal has been presented by the Commission to Council Working Party but no detailed discussions have taken place to date. As the Deputy is aware, the proposal must be agreed unanimously by all Member States before being adopted. I have said previously that I expect that such fundamental changes will be the subject of intense discussion and negotiation before legislative changes are adopted and it is not possible at this stage to predict the degree of discretion that will be available to Member States in relation to the rate of VAT on any particular category of goods.
In the meantime, Irish VAT law must comply with the current VAT Directive and therefore defibrillators remain liable to VAT at the standard rate, currently 23%.