Marc Ó Cathasaigh (Waterford, Green Party)
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73. To ask the Minister for Finance if his Department has any plans to change VAT rates in Ireland in response to the coming zero rates of VAT on energy-saving materials such as solar panels in Northern Ireland, due to the Windsor Framework; and if he will make a statement on the matter. [11093/23]

Michael McGrath (Cork South Central, Fianna Fail)
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As the Deputy will be aware, the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the Directive provides that all goods and services are liable to VAT at the standard rate unless they fall within Annex III of the Directive, in respect of which Member States may apply either one or two reduced rates of VAT. Ireland currently operates two reduced rates of VAT, 13.5% and 9%, as permitted by the Directive.

Following amendments to Annex III of the VAT Directive, agreed in April 2022, it is now possible to apply a reduced or zero rate to solar panels and a reduced rate to supply and installation of certain highly efficient low emissions heating systems.

Decisions about tax changes are generally taken in the context of the Budget and, as part of our normal annual Budget preparations. In this context, various options for tax policy changes will be considered by the Tax Strategy Group prior to Budget 2024. This will include any assessment of the impact the Windsor Framework will have on the supply of goods and services in Ireland.