Peter Fitzpatrick (Louth, Fine Gael)
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83. To ask the Minister for Finance if a matter (details supplied) will be addressed regarding claiming back VAT; and if he will make a statement on the matter. [8931/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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Irish VAT law does not provide for VAT input deductibility by VAT registered persons in respect of petrol.

VAT registered persons that make supplies are entitled to claim the cost of VAT on the purchase of diesel used in the course of their business, as is the case with most business costs. However, section 60 of the VAT Consolidation Act 2010 prohibits VAT deductibility by businesses on certain goods and services for anti-avoidance reasons. Expenditure on petrol, as well as expenditure on food, drink, accommodation, and entertainment is specifically excluded from deductibility entitlement, even where the petrol or other goods and services are acquired or used for the purpose of a taxable business. 

Under Article 176 of the EU VAT Directive, Ireland can retain certain restrictions on VAT deductibility that were in place before 1979. As VAT input deductibility has been restricted on petrol since 1972, Ireland can retain that block on deductibility. If this restriction is removed or eased, it would not be possible to reintroduce it.

There is a case for petrol and diesel to be treated equally in terms of input deductibility entitlements as there is a greater level of diesel run personal motor vehicles in operation today than in the past. However, the provisions of Article 176 prohibit the application of a new deductibility restriction on diesel expenditure. As the anti-avoidance concerns regarding petrol expenditure deductibility continue, the restriction on VAT deductibility remains valid.