Clare Daly (Dublin North, Socialist Party)
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Question 107: To ask the Minister for Finance his views on the retention of the VAT exempt status of printed books; his plans to abolish the VAT rate on e-books; and if he will make a statement on the matter. [9769/11]

Michael Noonan (Limerick City, Fine Gael)
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I am advised by the Revenue Commissioners that the VAT rating of goods and services is subject to the requirements of EU VAT law with which Irish VAT law must comply. In so far as the supply of printed matter is concerned, three different rates may apply. The general position is that books are zero-rated, newspapers and periodicals are subject to VAT at the reduced rate (currently 13.5%) and stationery and other printed matter are liable at the standard rate (currently 21%). The zero rate applies to printed books, including atlases, children's picture, drawing and colouring books and books of music. The reduced rate applies to newspapers and periodicals, including sectoral publications (sports, fashion, etc.), holiday brochures, prospectuses, catalogues and maps. The standard rate applies to a wide range of printed goods, including stationery, calendars, greeting cards, diaries, yearbooks and posters. Under the EU VAT Directive, all digitised publications, regardless of their rate when printed (for example, a book liable at zero rate), are treated as the supply of a service liable at the standard rate of VAT. E-books, online newspaper subscriptions and online information services purchased via download over the Internet are also considered the supply of services liable for VAT at the standard rate. The EU position is that digital information services are not the direct equivalent of traditional printed products, including books. Even where the content is similar, the additional functionality (e.g. search facilities, hyperlinks, archives etc) associated with electronic content produces a fundamentally different product.