Gerald Nash (Louth, Labour)
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138. To ask the Minister for Finance if he will consider revisiting the decision to end the zero VAT rating on antigen testing kits; and if he will make a statement on the matter. [3086/23]

Barry Cowen (Laois-Offaly, Fianna Fail)
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151. To ask the Minister for Finance if he will remove VAT on antigen tests; and if he will make a statement on the matter. [3070/23]

Michael McGrath (Cork South Central, Fianna Fail)
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I propose to take Questions Nos. 138 and 151 together.

As the Deputy will be aware, VAT on supplies of Covid 19 testing kits have been subject to a temporary zero rate up until 31 December 2022 as a result of an EU Commission derogation.

While recognising the success of the Government’s vaccination programme, I have decided that Covid-19 test kits should be subject to a zero rate of VAT on an ongoing basis. This is because there are still significant level of this virus in general circulation. My decision is reinforced by the public health guidelines which continue to advise caution, in particular recommending self-isolation if one has symptoms of COVID-19 and recommending Covid testing for certain vulnerable groups.

I propose that the zero rating of Covid 19 testing kits will be put on a legislative basis at the first available legislative opportunity, however in the meantime, the Revenue Commissioners have agreed to operate it with effect from 1 January 2023 on an administrative basis.

Michael McGrath (Cork South Central, Fianna Fail)
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A key objective of the government’s Housing for All plan is a pathway to increase housing supply, including a focus on providing an adequate supply of available serviced zoned land within required densities. In this regard, provision was made in the Finance Act 2021 for a new tax on land zoned for residential development, which also has the necessary services in place. The Residential Zoned Land Tax (RZLT) is designed to prompt residential development by landowners of land that is zoned for residential or mixed-use (including residential) purposes and that is serviced.

RZLT is an annual tax, calculated at a rate of 3% of the market value of the land within its scope. The tax will be due and payable from 2024 onwards in respect of land which fell within the scope of the tax on or before 1 January 2022. Where land is zoned or serviced after 1 January 2022, the tax will be first due in the third year after the year in which it comes within scope.

It is important to note that, to come within the scope of RZLT, farmland must be both zoned for residential use and serviced. Farmland that is zoned for residential use, but which is not currently serviced is not within the scope of the tax will only come within the scope of the tax should the land become serviced in the future.

Section 653B(b) of the Taxes Consolidation Act 1997 provides that land will be considered to be serviced for the purposes of the tax where it is reasonable to consider that the land has access to, or may be connected to, public infrastructure and facilities, including roads and footpaths, public lighting, foul sewer drainage, surface water drainage and water supply, necessary for dwellings to be developed on the land and with sufficient service capacity available for such development.

Where land meets the criteria to fall within the scope of the tax as set out above, a number of exclusions may apply.

As the Deputy’s question relates to land zoned as mixed use one of the exclusions may be of particular relevance.

Land which is zoned for a mixture of residential and other uses (and not purely for residential development), is only considered to be within the scope of RZLT where it is considered to be ‘vacant and idle’. Land which is vacant and idle is defined in the Taxes Consolidation Act 1997 as follows: -

‘Vacant or idle land’ means land which, having regard only to development (within the meaning of the Act of 2000) which is not unauthorised development (within the meaning of the Act of 2000), is not required for, or integral to, the operation of a trade or profession being carried out on, or adjacent to, the land.'

Farming is considered a trade, it is exempted development, and where the land is being actively used for such a purpose, or is integral to the use of adjoining lands for farming, then the lands would not meet the definition of being vacant and idle As such, farmland which is zoned for mixed use, including residential use, and which is integral to the operation of a farming trade carried out on or beside it, is excluded from the tax, even where such land is serviced and should not be reflected on the RZLT maps prepared and published by local authorities identifying land within the scope of the tax.

A draft RZLT map was published by all 31 local authorities on 1 November 2022. The purpose of the draft map is to allow landowners, including farmers, to see if their land is within the scope of the tax. If a landowner sees that their land is included on the draft map and believes that it should not be, they should have made a submission to their local authority by 1 January 2023 seeking to have the map updated and their land removed from the map. Local authorities are currently considering the submissions received and will provide landowners with a written determination on whether the land should stay on the map or be removed from it on or before 1 April 2023. If the landowner disagrees with the determination, they can appeal to An Bord Pleanála on or before 1 May 2023.