Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

VAT is a tax on consumption and is applied to supplies being made by a person and not to supplies received by them. In this context, it is not possible under EU VAT law, with which Irish VAT law must comply, to introduce VAT exemption based on goods and services received, or to introduce an exemption based on the recipient of a good or service. Charities and non-profit groups engaged in non-commercial activity, including those involved in 1916 commemorations, are exempt from VAT under the EU VAT directive and this is reflected in the VAT Consolidation Act 2010. This means they do not charge VAT on the services they provide and cannot recover VAT incurred on goods and services that they purchase. Essentially, only VAT-registered businesses which charge VAT are able to recover VAT.