Timmy Dooley (Clare, Fianna Fail) | Oireachtas source

I welcome the Minister of State setting out the facts as they are. A UK business or operator established in the Six Counties can offer its services south of the Border. It can purchase all of its materials north of the Border, where it has the capacity to recover the VAT it pays. I do not suggest such companies do so on goods purchased south of the Border. This relates to inputs purchased north of the Border. There is nothing to prevent such a company from coming south to compete with operators in this jurisdiction that have a much greater cost base by virtue of their fuel inputs, etc. Such factors make it exceptionally difficult for them to compete with those involved in what I would describe as a predatory practice. We must recognise that the treatment or application of VAT is entirely different on either side of the Border.

The Minister of State has mentioned that this relates to an EU position. The Government has made much of its capacity to renegotiate matters at EU level in recent times. I would have thought it should be possible for it to seek some redress in this instance, given that it is clearly having a significant impact on a particular sector. It should be working at EU level to ensure the same set of circumstances applies south of the Border as north of the Border. This industry should be able to avail of a zero VAT rating or other compensatory measure that would ensure there was a fair and level playing pitch. Those who wish to ply their trade here should be treated equally in the interests of the protection of jobs. The Minister of State does not need a lecture from me about the devastating impact on the domestic economy of the fact that over 14% of people in our society are unemployed. The sector we are discussing would gain if this relatively minor change were made to an EU directive. Perhaps some other methodology might be used to ensure these operators can participate and compete on a level pitch. I ask the Government to consider the impact of what has happened in this sector and try to find a means of rectifying it. That is necessary if we are to retain the level of employment in this sector and enable those involved in it to compete effectively.

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