Brendan Griffin (Kerry, Fine Gael)
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181. To ask the Minister for Finance his views on a matter (details supplied) regarding VAT; and if he will make a statement on the matter. [6975/19]

Paschal Donohoe (Dublin Central, Fine Gael)
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The VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the VAT Directive provides that all goods and services are liable to VAT at the standard rate (which in Ireland is 23%) unless they fall within Annex III of the VAT Directive, in respect of which Member States may apply either one or two reduced rates of VAT.

In addition, the VAT Directive allows for historic VAT treatments to be maintained, under certain conditions, on certain goods and services which are not provided for in Annex III. Ireland has retained the application of the 13.5% reduced rate to the supply of fuel for domestic use which otherwise would be subject to the 23% standard rate of VAT. This includes wood pellet heating systems, which also apply at the 13.5% VAT rate instead of the 23% standard rate.

While some domestic fuels are more energy efficient and environmentally friendly than others, EU VAT law does not allow lower VAT rates to apply to different fuels on this basis.