Farmers’ VAT on business inputs
Callanan questioned whether farmers bear more indirect tax because VAT on machinery and other inputs is not reflected in the notional system. The Minister said VAT-registered farmers can claim refunds and argued that farmers can choose between tax systems unavailable to other groups; the exchange ended with a brief disagreement over whether he had understood the question.
Would the Minister not agree as regards the multiplier, the notional figure and farming taxation that the farmer pays a larger amount of indirect taxation than people in other walks of life? I am not saying the farmer should not pay taxes. A man in any other walk of life earning £4,000 may pay taxation on his car but he does not pay it on the implements which help to make his income as a farmer does, such as the money he pays in VAT.
Comment on this
As the Deputy knows, it is open to any farmer to register for VAT and by so doing to get a refund of any VAT paid by him on his inputs. Some have done it but most have not. That right exists.
Comment on this
Is the Minister saying that any VAT paid by a farmer in replacing machinery can be claimed under the notional figure?
Comment on this
If the person is registered for VAT purposes he can get a refund under the VAT regime. In regard to the notional system it must be remembered that this is not available to any other section of the community. No other section in the community is given a choice of taxation systems. Nobody else is given an opportunity to elect between paying one sum and another. One must balance all these things to arrive at a conclusion as to whether or not what has been offered is a fair system.