Robert Troy
Ceist:75. Deputy Robert Troy asked the Minister for Finance if any changes have been made in relation to the VAT refund order for farmers in place since 1972; and if he will make a statement on the matter. [22685/24]
Amharc ar fhreagraTuesday, 21 May 2024
Ceisteanna (75)
Freagraí scríofa
As the Deputy is aware questions around the application of the flat-rate farmers refund order have been raised on a number of occasion particularly over how VAT refund claims are being administered and processed by the Revenue Commissioners.
The refund order was originally introduced in 1972 and has seen minor amendments to the type of expenditure covered. In 1993, the order was updated to provide for claims for fencing and in 2012 the order was amended to clarify that certain equipment used for the microgeneration of electricity was covered. The refund order does not provide for any other farming equipment or machinery. It is not possible under the European VAT Directive for the scope of the order to be extended.
I am advised by Revenue that they can only administer the refund order according to the legislation as enacted. The agricultural sector, particularly the Dairy Sector, has evolved significantly since 1972. Since 1972, new products have come onto the market that differ from previous versions and while the function of the products may be identical, there are important differences from a VAT perspective. Revenue will continue to monitor refund claims for new and innovative products as they are received but can only refund expenditure that is within the scope of the legislation.
Revenue is engaging with the farming sector about their concerns on how VAT refund claims are being administered and have met with the ICMSA and IFA on several occasions, most recently with the ICMSA on 22 April and the IFA on 9 May. Revenue officials also attended the Joint Oireachtas Committee on Agriculture, Food and Marine on 8 May. Revenue is currently reviewing submissions from the representative groups. Revenue advise that it is anticipated that an updated guidance document will issue this month once all outstanding information has been received by Revenue.
Finally, the Deputy may wish to note, that it is always open to a farmer to elect to register for VAT in respect of their farming business and claim a full deduction for the VAT they incur on their business costs, subject to rules on deducibility.