Paschal Donohoe (Dublin Central, Fine Gael)

The VAT rating of goods and services is subject to the requirements of the EU VAT directive with which our law must comply. The service of hiring bicycles, including e-bikes, is included in Annex III and Ireland applies a reduced rate, currently 13.5%, to the supply of hiring bicycles, including e-bikes for a short period of time, no more than five weeks. Hire for longer periods is subject to VAT at the standard rate of 23%. While it may be possible for a reduced rate of VAT to be applied to short-term bike hire, it should be noted that there is no general expectation that a VAT reduction would benefit consumers. It should also be noted that a VAT reduction on the cost of bike rentals would only relate to the renting of the bike itself and not to the subscription fee to use a bike rental service. As such, any impact of a VAT reduction would be minor. For those reasons, I am not in a position to accept the amendment. In accordance with the Value-Added Tax Consolidation Act 2010, the sale of bicycles and e-bikes, including parts and accessories, is liable to tax at the standard rate which is currently 23%.