Róisín Shortall (Dublin North West, Labour)
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Question 128: To ask the Minister for Finance if there is an impediment under EU rules of zero rating VAT on domestic utility bills; and the implications for revenue if such an action were to be taken. [32301/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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The position is that the VAT rating of goods and services is subject to the requirements of EU VAT law with which Irish VAT law must comply. Under the Sixth VAT Directive Member States may retain the zero rates on goods and services, which have been in place since 1 January 1991, but cannot extend the zero rate to other goods and services. It is therefore not possible to apply a zero VAT rate to the provision of domestic utilities including electricity, gas and telecommunications. Furthermore, under EU law, it is not possible to reduce the VAT rate for a particular category of customer as the rate of VAT that applies to a particular good or service is determined by the nature of the good or service, and not by the category of customer. Consequently, it is not possible to reduce the VAT rates applicable to domestic utilities alone.

Finally, I am informed by the Revenue Commissioners that the information to be furnished on VAT returns does not require the yield from particular categories of consumer to be identified.