Jackie Cahill
Ceist:27. Deputy Jackie Cahill asked the Minister for Finance the reason that ESB customers are being charged VAT on the PSO levy on their bills; and if he will make a statement on the matter. [16886/22]
Amharc ar fhreagraWednesday, 30 March 2022
Ceisteanna (27)
Freagraí scríofa
VAT is governed by the EU VAT Directive, with which Irish VAT law must comply. Article 78 of the VAT Directive provides that the taxable amount shall include “taxes, duties, levies and charges, excluding the VAT itself”. The amount on which VAT is chargeable, in accordance with section 37(1) of the Value-Added Tax Consolidation Act 2010, is the total consideration receivable by the supplier, “including all taxes, commissions, costs and charges whatsoever” but not including the VAT itself.
In this respect, in the case of an energy bill, which includes the PSO levy, VAT law dictates that VAT should be calculated on the PSO levy element of the bill as well as the charge for the service. Similarly, where an energy bill includes carbon tax, VAT is charged on the full amount of the charge to the customer, which includes the carbon tax. The same situation applies in the case of other excises, including for example excises on petrol, auto-diesel, tobacco and alcohol products, where the VAT charged on these goods is also charged on the excise value.