Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I am glad to be in a position to be able to clarify the matter. The 2007 document to which Deputy McGrath refers was an internal Revenue document prepared in 2007. It was never published on the Revenue website. The document has no legal status or authority over VAT legislation in place on 1 January 1991 or subsequently. The document was simply an attempt to document the position that was current in 2007. It did not address the legal basis and simply documented the approach at the time. It highlights that the zero rate was only applied to certain food supplement products and not to all food supplement products. It specifically stated that there was no legislative reference for food supplement products in VAT law. The document makes clear that there is no legal foundation in place for the designation that the products had at that point. The document does not and cannot extend the derogation or create a derogation retrospectively. Even if the document existed on or before 1 January 1991, it still could not form a legal basis to create or extend the derogation.

The Revenue engaged an expert in the field of nutrition and science. The expert concluded that food supplement products are not conventional food. This is important from a legal perspective as only conventional food can be zero-rated under the derogated zero-rating for food products. It is clearly untenable that products claimed by some in the industry to promote hair growth, boost tanning or reduce stress could be food and therefore zero-rated. They could not by any reasonable definition be considered food.