Dáil Éireann Debate, Wednesday - 20 March 2024
254. Deputy Pearse Doherty asked the Minister for Finance the goods and services subject to the second reduced rate of VAT; the revenue generated through VAT for each good and service subject to the second reduced rate of VAT in 2021 and 2022; and the projected revenue generated through VAT for each good and service subject to the second reduced rate of VAT in 2023 and 2024. [12686/24]
Amharc ar fhreagraI am advised by Revenue that the VAT rating of goods and services is subject to the requirements of EU VAT law, with which Irish VAT law must comply. In general, the EU VAT Directive provides that all goods and services are liable to VAT at the standard rate, unless they fall within categories of goods and services specified in Annex III of the VAT Directive, in respect of which Member States may apply a lower rate of VAT. Currently, Ireland has two reduced VAT rates of 13.5% and 9%.
From 1 July 2011 onwards, the following supplies are subject to the second reduced rate of VAT (i.e. 9%):
• Periodicals e.g., magazines, sectoral publications, scholarly publications.
• the provision, by a person other than a non-profit making organisation, of facilities for taking part in sport.
From 1 January 2019 onwards, the following supplies are also subject to the second reduced rate:
• certain e-periodicals excluding those which wholly or predominantly devoted to advertising or consist wholly or predominantly of audio or video content.
For the period from 1 May 2022 to 31 October 2024, the following supplies are subject to the second reduced rate of VAT:
• the supply of electricity
• the supply of gas used for domestic or industrial heating or lighting, whether in gaseous or liquid form.
For the period from 1 November 2020 to 31 August 2023, the following supplies were subject to the second reduced rate of VAT:
• catering and restaurant supplies (excluding alcohol, soft drinks and bottled water)
• hot take-away food, and hot tea and coffee
• hotel lettings, including guesthouses, caravan parks and camping sites
• admissions to cinemas, theatres, certain musical performances, museums, art galleries or exhibitions
• amusement services of the kind normally supplied in fairgrounds or amusement parks
• admission to an open farm
• hairdressing services
and
• certain printed matter such as brochures, leaflets, catalogues or printed music (excluding books).
From 1 September 2023 onwards the reduced rate of VAT (i.e. 13.5%) applies to the above supplies.
In relation to VAT revenue, I am further advised by Revenue that traders are not required to identify the VAT yield generated from the supply of specific goods and services on their VAT returns. Therefore, it is not possible to provide the exact revenue generated from VAT on the goods and services subject to the second reduced rate of VAT using information provided on tax returns. However, a tentative estimate for the revenue from these broad categories of goods and services for the years 2021 to 2024, based on third party sources available to Revenue, is provided below.
|
VAT – Second Reduced Rate of 9% (€m) |
2021 |
2022 |
2023 |
2024 |
|
Accommodation* |
131 |
237 |
192 |
0 |
|
Catering* |
692 |
869 |
648 |
0 |
|
Hairdressing* |
39 |
55 |
38 |
0 |
|
Cinemas, Theatres, Other Entertainment and other* |
23 |
30 |
27 |
0 |
|
Electricity ** |
0 |
193 |
481 |
391 |
|
Gas ** |
0 |
47 |
171 |
124 |
|
Total |
885 |
1,431 |
1,557 |
515 |
*The 9% rate of VAT was applicable to these items throughout 2021 and 2022 until reversion to the 13.5% rate on 31 August 2023.
** The 9% rate of VAT is applicable from 1 May 2022 until 31 October 2024.
