Dáil Éireann Debate, Thursday - 8 September 2022
346. Deputy Ivana Bacik asked the Minister for Finance the rationale for imposing a rate of 23% VAT on dog and other domestic pet grooming services given that other veterinary services are taxed at different rates; and if it is intended to harmonise rates for the sector. [42550/22]
Amharc ar fhreagraI can confirm that the position remains as outlined to the Deputy on 30 June 2022 in reply to parliamentary question 128. For convenience the response to that question is set out below.
I am advised by Revenue that the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the Directive provides that all goods and services are liable to VAT at the standard rate unless they fall within Annex III of the Directive, in respect of which Member States may apply either one or two reduced rates of VAT. Ireland currently operates two reduced rates of VAT, 13.5% and 9%, as permitted by the Directive.
The provision of dog grooming services is not included in Annex III and as such is subject to the standard rate of VAT, currently 23%. There is no discretion under the Directive for Ireland to apply a reduced rate of VAT to this service.
The Deputy may be interested to know that by way of special derogation from the general rule, Ireland is permitted to continue its long-standing practice of applying a reduced rate, currently 13.5%, to the supply of services by a veterinary surgeon in the course of their profession, but there are strict restrictions on this derogation, including that the rate cannot be reduced below 12%. However, where a veterinary surgeon carries out a dog grooming services as part of the veterinary procedure, such as treating an illness or disease, the dog grooming is considered part of the veterinary procedure and the entire procedure is liable to VAT at the reduced rate. Where a veterinary surgeon provides a dog grooming service as a supply that is distinct from a veterinary procedure the service is liable to VAT at the standard rate of 23%.
