Matt Carthy (Cavan-Monaghan, Sinn Fein)
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117. To ask the Minister for Finance the VAT rates that apply to solar equipment, including rooftop solar photovoltaic; the amount of revenue raised arising from such in 2017 to 2021 and to date in 2022; the allowable VAT rates under European Union directives; and if he will make a statement on the matter. [47771/22]

Paschal Donohoe (Dublin Central, Fine Gael)
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I am advised by Revenue that the VAT rating of goods and services is subject to the requirements of EU VAT law, with which Irish VAT law must comply. In general, the EU VAT Directive provides that all goods and services are liable to VAT at the standard rate, unless they fall within categories of goods and services specified in Annex III of the VAT Directive, in respect of which Member States may apply a lower rate from VAT. The EU VAT Directive also allows for historic VAT treatment to be maintained under certain conditions on certain goods and services not provided for in Annex III. Currently Ireland has a standard VAT rate of 23% and two reduced rates of 13.5% and 9%. Ireland is also permitted to retain some historic VAT arrangements, under strict conditions.

On this basis, the supply of solar equipment, including rooftop solar photovoltaic, has been liable to VAT at the standard rate, currently 23%.  However, if these goods are supplied as part of a “supply and install” contract, they may be subject to VAT at the reduced rate of 13.5%.  A “supply and install” contract is where building services are provided in conjunction with the goods required for that building contract for example, solar panels.  Where the value of the goods supplied does not exceed two thirds of the total value of the contract, the full amount payable under the building contract will be subject to the rate at which the building services are supplied, being 13.5%.

I am advised by Revenue that traders are not required to identify the VAT yield generated from the supply of specific goods or services in their periodic VAT returns. Therefore, it is not possible to provide an estimate of the amount of VAT raised from the supply of solar equipment.

Under the EU VAT directive, a Member State may decide to apply a reduced or zero-rate of VAT to certain activities, including the supply and installation of solar panels on and adjacent to private dwellings, housing, and public and other buildings used for activities in the public interest.