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VAT on defibrillators for charities; property tax for charities

Ciaran Lynch (Lab, Cork SC) raised the issue of charities having to pay VAT on defibrillators to prevent sudden cardiac death (Dail Eireann, Debates, 22nd January 2013, 60-62).  In the 12 months to end last October, 123 people had been saved by the use of defibrillators and the Department of Health had recommended, in 2004, that they be available at sports venues – yet voluntary organizations getting no government money had to pay the government 23% for the privilege.


Replying for the government, the Minister of State at the Department of Health, Alex White, said that this VAT was a requirement under European Union law from which neither Ireland nor defibrillators could be exempt.  There was provision under the VAT (Refund of Tax) no. 15 order, 1981 for refund of VAT for the purchase of a defibrillator by an individual to overcome disability, but a charity or voluntary body did not not qualify. Such refunds were contrary to European policy that VAT should be paid by the final consumer and no refund orders had been introduced since the 1980s. Voluntary and charitable groups and certain sporting bodies were already accorded exemption from various taxes, ‘including an exemption from VAT on supplies’.


Ciaran Lynch, though, described this as an anomaly in the tax system and asked that Ireland use its presidency of the European Union to have the matter examined at European level.    The Minister of State told him that whereas there was no argument as to the value of defibrillators, the same VAT rate applied in other member states – but if anything could be done within the scope of existing tax law, he was sure the Minister for Finance would consider it.


Meantime, Seamus Kirk (FF, Louth) asked would charities be exempt from the new property tax (Dail Eireann, Debates, 17th January 2013, 854-5).  The Minister for Finance, Michael Noonan, told him that section 7 of the Finance (local property tax) Act provided such an exemption for properties for people with special accommodation needs (e.g. older people, people with disabilities, homeless, victims of domestic violence) in accommodation provided for by voluntary and cooperative housing bodies that had charitable exemption, which he expected that they all had.  This did not apply when such bodies provided general housing needs for those not eligible for local authority housing and here the government did not accept the recommendation of the interdepartmental group, called the Thornhill group, for all charitable bodies.  A blanket exemption would be inequitable compared to the local authorities, whose properties were subject to property tax.  The government would engage actively with approved housing bodies to ensure that local property tax did not impact adversely on them.