Food supplements VAT rise
Deputy Howlin objects to a 23% rise in VAT on food supplements being imposed by Revenue interpretation rather than legislation. The Minister for Finance says he is aware of the issue, notes it was not legislated for, and had intended to address it through the tax advisory process.
My question is also directed to the Minister for Finance. It is just as well because the Taoiseach has obviously had to leave. In the context of budget 2019, one of the tax measures that was not provided for in legislation but that seems to have been sneaked in was a 23% rise in the price of food supplements, which is to come into effect on 1 March. This was not done by way of legislative change, whereby Deputies of this House would have been able to deal with it in the Finance Bill. It was done by way of reinterpretation by the Revenue Commissioners.
The practice of zero-rating vitamins, minerals and fish oil supplements has applied since 1972. This is a very significant issue. There are hundreds of thousands of people across the country dependent on taking vitamins as part of their health regime. Such a fundamental change deserves much better consideration than has occurred. Will the Minister for Finance agree to halt the increase and engage with the stakeholders to determine whether some compromise can be arrived at?
Comment on this
I thank Deputy Howlin for raising this issue. It is one that I am now aware of. As the Deputy fairly acknowledged, this is not an issue that was dealt with in the Finance Bill, nor was it legislated for in the House. It concerns an interpretation of our tax code by the Revenue Commissioners which, as everyone knows, are independent of direction from me. I had been aiming to deal with the matter through the tax advisory group, which publishes papers on topics such as this each summer that allow the Government and stakeholders to explore options to determine how issues can be dealt with. In the case in question, the Revenue Commissioners have now made a decision on the interpretation of the law. I have to accept its right to do so and the consequences of that. In answer to the Deputy's question on whether we will engage with stakeholders on the matter to determine how it can be dealt with, we will do so but I am bound, as Minister for Finance, to abide by the interpretation of the Revenue Commissioners, which I will do.