Simon Harris (Wicklow, Fine Gael)
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Question 78: To ask the Minister for Finance the reason VAT is charged at different rates on the gas, electricity and telephone bills; the reason telephone bills are charged at a higher rate of VAT - 23% - compared to gas or electricity - 13% -; and if he will make a statement on the matter. [15568/12]

Michael Noonan (Limerick City, Fine Gael)
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VAT is charged on the supply of goods and services at different VAT rates, which are subject to the requirements of EU VAT law. The supply of gas and electricity is specified in paragraph 17 of Schedule 3 of the Value-Added Tax Consolidation Act 2010. Goods and services specified in paragraph 17 of Schedule 3 are liable at 13.5%. It is possible for Ireland to apply the 13.5% reduced rate to gas and electricity under Title VIII of the EU VAT Directive. The supply of telephone services, however, is not specified in one of the Schedules to the Value-Added Tax Consolidation Act 2010 and as such is liable to VAT at the standard rate, currently 23%. It is not possible for Ireland to apply a reduced rate to telecommunication services as the VAT Directive provides that the standard VAT rate must be applied to these services.