VAT on health supplements
Deputy Healy-Rae objected to the planned VAT increase on food supplements, warning it would hurt Irish businesses and ordinary families who rely on them. Minister Zappone said she understood the concerns, noted folic acid would remain zero-rated, and said she would use her influence while the Finance Minister reviewed the position.
The Government should not tax our health. People are sick to death of additional taxes appearing at every opportunity. The latest attack on consumers is the increase in VAT on food supplements which is proposed to come in soon.
The majority of products in Ireland affected by the 23% VAT rate are supplied by Irish companies which work closely with the Food Safety Authority of Ireland to ensure their products' safety and compliance with regulations. They employ hundreds of Irish people.
The Taoiseach questioned the science behind food supplements. All claims made for such products are governed by the European Food Safety Authority. The claims relate to the support and maintenance of health. The rulings are based on international large-scale clinical trials and peer supported research. When I questioned him in the Dáil recently, the Taoiseach was not sure whether folic acid was a food supplement, but he will find out soon enough on 1 March when the Government applies the 23% VAT rate to it, affecting women who are trying to look after their health during pregnancy. It is the same Taoiseach who told people a couple of weeks ago that he was going to reduce his carbon footprint by decreasing his meat intake, one of the most idiotic statements ever made by a Taoiseach. For a Taoiseach to send the message that he will stop eating meat to a farming country that is proud of its tradition of farming and in which people survived with nothing for years was so stupid and beyond belief. He was encouraging people to adopt a healthy lifestyle, while at the same time agreeing to a 23% VAT rate on food supplements.
Comment on this
The health food stores I will discuss are independent. For example, we have a great person in County Kerry, Mr. Dan Horan, who is the proud owner of Horan's Health Stores and last week celebrated 30 years in business, giving much needed employment in County Kerry and beyond, just as other independent health food stores have done. These businesses have customers who are young, middle aged and older and who, in taking care of themselves, rely on health food supplements for their well-being and in staying away from the doctor's surgery and out of the hospital system. The Government's answer is to tax them at a rate of 23%. I will provide a couple of examples shortly, but I want to hear whether Deputy Zappone, as an Independent Minister, supports the Government in applying the 23% VAT rate to such customers.
Comment on this
I thank the Deputy for his question. As I have an interest in this issue, I am glad that he raised it. I will give the House my view as an Independent.
There are at least two aspects to the Deputy's remarks on vitamins. First, many people, including me, take them and avail of supplements regularly or, if we forget, sporadically in order to improve or optimise our health and well-being. This is often the case for people, in particular older people, who believe they are deficient in certain areas and need supplements to counteract it. In other cases people take vitamins while recovering from illnesses or because they feel run down. From that perspective, I understand why the Deputy has raised the issue. Many Irish people depend on vitamins and supplements for their well-being, including me.
The second aspect relates to the viability of businesses that depend on the sale of these products for their livelihood. Given the general uncertainty about Brexit, additional impediments such as the increased VAT rate cause concern and deserve our attention. As my father sold health food products and vitamins, I understand the issue from the consumer's perspective, as well as from a business perspective.
These issues have been raised previously and I have listened to the Minister for Finance, Deputy Donohoe, address them. I was in touch with him about them. I am pleased to say he is reviewing the matter, albeit with the caveat that it involves an interpretation of the law that could prove to be an insurmountable difficulty. However, I understand he will be in a position to come to a conclusion on the issue in the coming days.
Comment on this
I very much appreciate the Minister's genuine response, but I remind her that she is not a person outside on the street making an observation. She is a Cabinet Minister and a person who should have influence in the Government. Will she and its other Independent members, many of whom I respect, including the Minister of State who is sitting alongside her, Deputy Moran, use their influence to try to make the rest of the Government see common sense? I will provide a couple of examples. A married lady with two teenage children who take a number of supplements currently has a bill of €87 per month. This figure will increase to €107. A 48 year old married person with two children who works four days per week takes a number of items at a cost of €70 per month. That figure will increase to €86. I have another case which involves a person who is 88 years of age. These are the types of people we respect. A semi-retired farmer, he still does a lot of work on his farm and is grateful to be in extremely good health.
Comment on this
His good health is due to the support of his local GP and the vitamins and supplements he takes.
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His bill of €91 which he manages to pay will increase to €112 per month.
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These are real cases of people who are taking care of their own health. Will the Minister and other Deputies who support the Government, please, use their influence with the Taoiseach? He made a derogatory statement the first day-----
Comment on this
-----but there was such a backlash, he was not long in copping on to the seriousness of the issue. I would appreciate it if the Minister and her colleagues did something to stop this before it starts. I apologise to the Ceann Comhairle.
Comment on this
I thank the Deputy for making those points and bringing to our attention the lives of the real people on whom this will impact significantly. I have seen evidence of supplements increasing the health and well-being of people, both young and old, who take them. The Deputy mentioned something in his initial contribution that I did not get a chance to address. My understanding is folic acid is not included and will remain subject to the zero rate of VAT.
Comment on this
To respond to another of the Deputy's points, yes, I sit on this side in this row and will use my influence. The Minister for Finance, Deputy Donohoe, has indicated that he is reviewing the position. We will hear the results of the review shortly.