Peadar Tóibín (Meath West, Sinn Fein)
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Question 140: To ask the Minister for Finance if he will introduce a VAT refund scheme for charities. [7975/11]

Michael Noonan (Limerick City, Fine Gael)
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Charities and non-profit groups engaged in non-commercial activity are exempt from VAT under the EU VAT Directive, with which Irish VAT law must comply. This means they do not charge VAT on the services they provide and cannot recover VAT incurred on goods and services that they purchase. Essentially only VAT registered businesses which charge VAT are able to recover VAT. I have no plans to introduce a VAT refund scheme for charities. It is not clear that refunding VAT paid by charities is an appropriate method as opposed to grant-aiding the activities of charities using other criteria.

The tax code already treats charities in a favourable manner. The tax code currently provides exemption for charities from Income Tax, Corporation Tax, Capital Gains Tax, Deposit Interest Retention Tax, Capital Acquisitions Tax, Stamp Duty, Probate Tax, Dividend Withholding Tax and the uniform scheme of tax relief for donations.