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

The VAT rating of goods and services is subject to the requirements of EU VAT law, with which our law must comply. As the Deputy is aware, significant changes have now occurred with regard to that. The tax strategy group, TSG, published a paper earlier this year outlining some of the options now available for Ireland and other member states to consider. I suspect the one the Deputy is most aware of is that concerning solar panels and the potential for a lower rate or zero rate of VAT for them. I did not believe it was appropriate to introduce the measure in this budget, but we will continue to look at this as part of the future TSG process. I will share with the Deputy the rationale for our decision that this change could not be made in the budget. There is flexibility in this regard and I have used it elsewhere, for example, in applying the zero rate of VAT to defibrillators, which was needed.

See this speech in context