Andrew Doyle (Wicklow, Fine Gael)
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Question 147: To ask the Minister for Finance if he will raise the issue of a reduced VAT rate for defibrillators as a contribution to the debate being held at the EU Council of Ministers regarding the scope of VAT rates. [42942/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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In relation to the VAT rate that applies to defibrillators, the position is that under the VAT Directive, Member States may retain the zero rates on goods and services which were in place on 1 January 1991, but cannot extend the zero rate to new goods and services. The zero VAT rate cannot therefore be applied to defibrillators which are subject to the standard rate. In addition, Member States may only apply the reduced VAT rate to those goods and services which are listed under Annex III of the VAT Directive. While Annex III does include the supply of medical equipment for the exclusive personal use of a disabled person, it does not include defibrillators for general use.

The debate on reduced VAT rates at EU level has been dominated in the current stage of discussions by the issue of locally supplied and labour intensive services for which the European Commission has brought forward a proposal designed primarily to make permanent certain experimental reduced rate arrangements in this area. Of course, defibrillators for general use is just one of many goods and services for which a case can be made for a reduced rate of VAT. Having any items included in Annex III of the VAT Directive however requires the agreement of all Member States. The Exchequer impact of reducing the VAT rate on a range of such potentially desirable goods and services has also to be recognised.