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

As discussed on Committee Stage, a working group was established earlier this year, comprising representatives from the Department, the Revenue Commissioners and the Irish Charities Taxation Reform Group, to examine options available to reduce the VAT burden on charities. The report from the group was provided ahead of budget 2016 and is available on the budget 2016 website. The charities sector already benefits from a range of ministerial refund orders and special tax treatment across a number of tax heads. Requests for new ministerial refund orders have been constantly refused since the 1980s, primarily to maintain the integrity of the VAT system. Following consultation with other member states, the report of the working group found relatively limited favourable VAT treatment for charities across Europe. As I stated on Committee Stage, I believe tax expenditures can be blunt instruments and I am not convinced this is the best way to address the issue. In addition, introducing a VAT refund scheme for charities would most likely lead to similar claims from other VAT exempt organisations, most notably sporting organisations. Accordingly, I regret I cannot accept the amendment.

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