Finian McGrath (Dublin North Central, Independent)
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Question 171: To ask the Minister for Finance if he will support a matter (details supplied). [44772/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Any proposed changes in VAT must be considered in the context of EU law, with which Irish law must comply. While Member States can retain the zero rating provisions which they had in existence on 1 January 1991, they cannot introduce any new ones. Since the supply or installation of home insulation materials was not zero-rated in 1991, it is not possible for Ireland to apply a zero rate to such products or to their installation.

However, the reduced VAT rate of 13.5%, to which the Deputy refers, may be applied to home insulation materials where they are provided under a single supply and install contract where the VAT exclusive cost of the goods does not exceed two-thirds of the total VAT exclusive charge to the customer. When supplied outside of such a contract, home insulation materials are subject to the standard VAT rate which in Ireland is 21.5%.