Written answers

Thursday, 23 October 2014

Department of Finance

VAT Rate Application

Photo of Stephen DonnellyStephen Donnelly (Wicklow, Independent)
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67. To ask the Minister for Finance his views on the VAT rate in relation to food supplements such as probiotics and glucosamine, which provide sustenance and are not taken for sports nutrition or body-building purposes but which, according to the Revenue Commissioners, should be liable to standard rate VAT of 23%, despite published guidance to say that food supplements that provide sustenance may continue to be supplied at the zero VAT rate; and if he will make a statement on the matter. [40727/14]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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The EU VAT Directive generally provides that supplies of goods and services be chargeable to VAT at the standard rate but that lower rates are permitted in very limited circumstances.  Food products can only benefit from the zero rating in accordance with Article 110 of the VAT Directive which permits the retention of the zero rate for "clearly defined social reasons" where the products were liable to VAT at the zero rate on and from 1 January 1991. 

As set out in eBrief 70/2011 a range of food supplements and vitamins that encourage the maintenance of health, through the sustenance derived from a normal, healthy diet, benefit from the zero rate.  However,  a food supplement taken for the purposes of muscle growth or body mass increase, or for the purposes of weight reduction or bodily sculpture, cannot benefit from the zero rate since such products would not meet the "clearly defined social reasons" criteria.  The two supplements mentioned by the Deputy could be a zero-rated food supplement or one liable at the standard rate but there is insufficient information provided to make such a determination.  I would suggest that the Deputy provide details of the supplements to which he refers to the Revenue Commissioners who will advise on their correct VAT treatment as appropriate.  

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