Paul Gogarty (Dublin Mid West, Green Party)
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Question 47: To ask the Minister for Finance his views on removing the high level of VAT from motorcycle safety equipment and other safety equipment, in view of the fact that this encourages the purchase of cheaper, lower quality equipment from abroad, or discourages the usage of non-obligatory safety equipment; and if he will make a statement on the matter. [32791/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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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 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. As safety equipment, including motorcycle safety equipment, was not subject to the zero rate on 1 January 1991 it is not possible to apply the zero rate to the supply of such products. 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. As Annex III does not include the supply of safety products in general, the only rate that can apply to such products is the standard VAT rate which in Ireland is 21.5%.

As the Deputy may be aware, Annex III specifically provides that the reduced VAT rate can apply to the supply of children's car seats and in that context, the VAT rate applicable to child car seats was changed from the standard VAT rate to the reduced VAT rate of 13.5% from 1 May 2007.