Seán Fleming (Laois-Offaly, Fianna Fail) | Oireachtas source

I appreciate the additional comments that have been made by Senators in the second round of discussions on this measure. First, I must bow to Senator Casey, who knows the industry exceptionally well. Some people use the purchases. They purchase items before they leave the country and take those items with them. I hope, therefore, nobody is listening too carefully to that and starts checking to see whether a person used the shillelagh before he or she brought it home.

I wish to make one little addition to what Senator Casey said. I gave the examples of where it can be done at the airport by the major operators. Shops can do it and or they can operate a VAT-off scheme and take the risk onto themselves. Senator Casey, however, mentioned the scheme where the retailer does the exporting. That is another scheme entirely. It is not exactly this scheme; it is a separate provision for a separate scheme. It is not one of the methods under this scheme but it is still there.

To go back again, however; why are we here? We are here because the British voted for Brexit and the UK is leaving the EU on 31 December. None of us wanted to be here with Brexit Bills for the second year in a row, and here we are at this late stage. It is not our choice but we must deal with it.

As I have already stated, 65 sections of this legislation are to do with taxation measures. The majority of it is tax-related, whether it is VAT, customs tax, income tax or all those arrangements. There are, therefore, quite a number of issues when a country chooses, for the first time ever, to leave the EU. Many financial implications are involved and this is one of those. It is not of our making that we are here having this debate; the UK leaving is the reason we are here in the first place.

That said, I wish to make some final points. As to where the €75 threshold came from, it is not an exact science. As we have said, in the EU, €175 is the maximum figure. Only two countries have a zero figure. We went for a figure of €175 in the beginning. When the Minister published the Bill, he had a figure of €175. The Minister and the Government, however, listened to the public debate. They took on board what the people said, accepted they had a valid point and went more than halfway. They did not just halve it; they cut it by 60%.

That figure of €75, therefore, was in response to the views being expressed by the trade, the tourism sector, the public at large, Members of the Oireachtas and other public representatives. It felt reasonable and the Minister went back to Cabinet and got approval to bring in the figure of €75, which he felt, in view of the comments made, was the most appropriate thing to do. I compliment him on arriving on that amount. He could have picked €80, €90, €70 or €60 but he chose €75, which was a long way down from the original €175. I believe it was fair.

Perhaps, I have not made this specific point clear up until now. In order that people listening can understand what we are talking about, this is a system whereby people from outside the EU who come here as tourists and spend money in shops can get VAT back if they export the product back with them when they leave the country. We all understand that.

It only applies to people from outside the EU, for example, Americans, Chinese, Saudi Arabians or whoever comes to the country. It does not apply within the EU at all. It is, therefore, not available to French, German or Spanish people or for us going to Spain, France, Italy or England at the moment or to English people coming here at present. This is the positive aspect of this legislation, about which perhaps I should have been more upfront earlier.

As we speak today, a UK person coming to Ireland can spend all he or she likes but will get no VAT back. That person is not eligible because he or she is in the EU. We are now introducing a system, for the first time ever, where travellers coming from the UK into Ireland can go to a tourist shop, spend more than €75 and get VAT back for the first time in their lives. This, therefore, will probably cost the Exchequer money in providing VAT refunds to UK tourists who were never able to get a VAT refund from the Irish Exchequer previously. They will, therefore, now be able to get VAT back. This should be a positive selling point by the Irish tourism sector to British tourists coming to Ireland.

More than 3 million people come to Ireland from the UK every year. It is at least 30% of the inward travel. This is an advantage to the UK, now it has left the European Union after Brexit. It was not able to avail of this scheme because it was in the EU up until now. Now the UK has left the EU, we are saying to such tourists that for the first time ever, when they come to Ireland, as they have been doing for years, and when they come home at Christmas and the new year to meet family and friends and buy here, they can spend more than €75 in any transaction. A person can spend €750 on ten transactions if he or she likes. I ask them to please do so and support the industry. When that person goes back to England, he or she will get the VAT back on all that.This is a positive sales point to encourage British tourists to spend money in Ireland. The incentive never existed before because Britain was in the EU. Since it is now outside the EU, the new incentive has been made available so the British will spend money when they come here, either as tourists or to visit family. They will be able to get VAT back for the first time. It will be a cost to the Irish Exchequer. It is a new aid to all British tourists coming into the country that we should promote. The tourists will not know about it, nor will the shops, which are closed and are not listening to this debate. I urge Fáilte Ireland to tell everybody about it and erect signs at our ports and airports targeting people coming in from Britain, informing them that for the first time ever they will be able to get VAT back. It can be argued that a certain amount has to be spent before getting the VAT back but many visitors spend more than €75 on a transaction. They will get VAT back.

I was asked about the position on Northern Ireland and I stated there is no change for Northern Ireland. Owing to the Northern Ireland protocol, Northern Ireland is deemed to be within the Community for tax purposes. In fact, the people from Northern Ireland are excluded from the benefit that people from England, Scotland and Wales will be able to avail of from now on. I can understand it if they have a gripe but they are actually getting the best of both worlds in that they benefit from being within the UK and from being within the Community for taxation purposes on most matters. A British tourist, for the first time ever, will be able to claim VAT back on expenditure in Ireland. That is a major selling point. It will cost us some money. I hope Fáilte Ireland and the other tourism bodies promote the scheme. Rather than regarding the scheme as a drain and a risk, or as something negative, as I initially regarded it, why do we not use it as a positive selling point? It is positive in that it will encourage British tourists to spend money here and get VAT back. I hope that will increase tourism sales in all the shops around the country that we have been talking about.

I have spoken personally to the Ministers directly involved. They are committed to the figure of €75. They listened carefully and reduced the threshold from €175 to €75. They feel they have gone more than half way in meeting the legitimate points made. They have taken them on board. They have committed to a review during the course of the year, just as the Revenue Commissioners review every tax heading every year. If a tweak, amendment or change is needed in the Finance Bill next year or the following year, it can be made when we gather some of the relevant information during the course of the coming year. Unfortunately, I am not in a position to accept the amendment as proposed.