Brendan Smith (Cavan-Monaghan, Fianna Fail)
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80. To ask the Minister for Finance if he will reconsider his decision to apply VAT to personal insolvency services; and if he will make a statement on the matter. [31927/13]

Michael Noonan (Limerick City, Fine Gael)
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Minister for Finance ( Mr Noonan): I am informed by the Revenue Commissioners that the service provided by personal insolvency practitioners does not qualify for exemption in accordance with the EU VAT Directive, Irish VAT law, and relevant decisions of the European Court of Justice. Therefore, like other insolvency services such as those provided by liquidators, receivers and examiners, the service provided by a personal insolvency practitioner is liable to VAT at the standard rate of 23%.

I am also informed by the Revenue Commissioners that under a personal insolvency arrangement, the personal insolvency practitioner's fees are ultimately deducted from the dividend payments to the creditors under the arrangement rather than charged to the debtor. As the debtor is availing of a personal insolvency arrangement because of their insolvent position, it is the creditor who is bearing the ultimate cost of the fees and the VAT on the fees. Ref No: 31927/13