Declan Breathnach (Louth, Fianna Fail)
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225. To ask the Minister for Finance if his attention has been drawn to the fact that the measure introduced in the last budget to charge VAT on training and development activities is having the effect of actively discouraging businesses from offering training and development opportunities to their staff; if his attention has been further drawn to the fact that the measure has led to training courses being cancelled to the detriment of the business providing training and also the staff that would have benefitted from the training; and if he will make a statement on the matter. [13559/17]

Michael Noonan (Limerick City, Fine Gael)
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I have been advised by Revenue that the legislative provision which exempts education and vocational training from VAT was amended by the Finance Act 2015. The amendment ensures that national VAT legislation reflects recent judgements of the Court of Justice of the European Union.

The amendment provides that VAT exemption applies to providers of children's or young people's education and school or university education where it is provided by a recognised body. Exemption also continues to apply to training and development courses where the training and retraining is of a vocational nature. This means that exemption applies to training or retraining courses which prepare trainees for future employment and to training relating directly to a trade or profession given to a person in order to improve their ability to carry out their work. Where a course is offered by a business to their staff and it relates to their work, the training and development course continues to be exempt from VAT.

Revenue has consulted closely with stakeholders in the training and development sector and has prepared detailed guidance for providers. The draft guidance has been circulated to industry representatives for their views and will be published in the coming weeks.  If an education or training provider has any doubt as to the taxable status of a particular activity, they should contact their local Revenue District for advice.