Paschal Donohoe (Dublin Central, Fine Gael)
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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%.