Charlie McConalogue (Donegal North East, Fianna Fail)
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195. To ask the Minister for Finance if the VAT relief which is available on fuel for drivers and passengers with disabilities will be available in 2015; and if he will make a statement on the matter. [46043/14]

Michael Noonan (Limerick City, Fine Gael)
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The Disabled Drivers and Disabled Passengers (Tax Concessions) Scheme provides relief from VAT and VRT (up to a certain limit) on the purchase of an adapted vehicle for transport of a person with specific severe and permanent physical disabilities, repayment of excise duty on fuel, and an exemption from motor tax. While the Scheme provides for the repayment of excise duty on fuel used in the adapted vehicle, it does not provide for the relief of VAT paid in respect of the fuel used.

I assume the Deputy is referring to the introduction of the new fuel grant scheme to replace the repayment of excise duty on fuel element of the Scheme. In April 2013 the Court of Justice of the European Union ruled that the excise relief element of the Disabled Drivers and Disabled Passengers (Tax Concessions) Scheme is incompatible with the EU Energy Tax Directive. My Department has informed the European Commission of my intention to remove the excise relief element of the Scheme at the end of 2014 and replace it with a fuel grant in 2015. The European Commission has raised no objections.

To give effect to this I signed a statutory instrument in March of this year (S.I. 139 of 2014) with the effect that Regulation 16 of the Disabled Drivers and Disabled Passengers (Tax Concessions) Regulations (S.I. 353 of 1994) would be revoked as of 1 January 2015. As such, members of the Scheme may claim excise relief on any fuel used up to 31 December 2014. From 1 January 2015, current and prospective members of the Scheme will be eligible for a fuel grant in respect of fuel used during the year.

At this time, I intend to maintain the current practice of paying the sum a year in arrears, so that the first payment of the fuel grant would take place on 1 January 2016. I have instructed my officials to design the new grant in such a way to provide as seamless a transition as possible between the excise relief on fuel element and the new fuel grant and, as I stated in March, members of the Scheme will not be at a loss in the transition.

Officials from my Department are continuing to engage with other Departments and the Revenue Commissioners in order to put in place the legislative, administrative and financing changes necessary for the operation of the fuel grant. I intend to notify members of the Scheme of the details of the new fuel grant as soon as all the details are finalised.