Charlie McConalogue (Donegal, Fianna Fail)
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110. To ask the Minister for Finance his plans to revise the VAT rate on the sale of alpaca livestock in order that it is in line with the agricultural VAT rate on other livestock sales; and if he will make a statement on the matter. [47675/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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VAT rating is guided by the EU VAT Directive, with which Irish VAT law must comply.  Article 110 of the EU VAT Directive allows Member States to apply a rate of less than 5% to goods and services to which that rate applied on and from 1 January 1991. This is an historical derogation known as a super-reduced VAT rate.  Normal reduced VAT rates must be 5% or more.

As Ireland applied a super-reduced rate to the supply of livestock on 1 January 1991 we are entitled to retain that rate but the VAT Directive does not allow any new items to be applied at the super-reduced rate after that date.

For VAT purposes, livestock is defined as meaning live cattle, sheep, goats, pigs, deer, and horses normally intended for use in the preparation of foodstuffs or in agricultural production. As alpacas were not included in the definition of livestock on 1 January 1991 it is not possible to apply the 4.8% super-reduced rate to them now. In this regard the rate of VAT on the importation or supply of alpacas is the standard VAT rate of 23%.