Denis Naughten (Roscommon-South Leitrim, Fine Gael)
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Question 110: To ask the Tánaiste and Minister for Finance his plans to have Annex III of the EU VAT directive amended to include road safety products, and thereby reduce the rate of VAT applicable on such products; and if he will make a statement on the matter. [22313/07]

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 VAT Directive Member States may only apply the reduced VAT rate to those goods and services which are listed under Annex III of the VAT Directive. As Annex III does not list the supply of road safety products, the rate that can applies to such products is the standard VAT rate which in Ireland is 21%. However, as it was possible under EU law, I have reduced the VAT rate applicable to children's car seats from the standard VAT rate to the reduced VAT rate of 13.5%. This came into effect on the 1st July 2007.

In relation to amending Annex III of the VAT Directive, the Deputy will be aware that this could only be done in the context of an overall review at Community level of reduced rates. That would be the forum for such a proposal. Whilst the Commission has launched a debate on reduced rates in July 2007, as yet, no specific Commission proposals have been brought forward. Generally, any significant review of the application of VAT across the different EU Member States can be complex.