Seán Canney
Question:231. Deputy Seán Canney asked the Minister for Finance if he will support an urgent matter for a person (details supplied). [10151/23]
View answerTuesday, 28 February 2023
Questions (231)
Written answers
At the outset, I wish to acknowledge the difficult position that Ms. Gath faces in relation to her tax bill as a result of importing an adapted vehicle into the State from the UK.
The Deputy should note that I will be meeting Ms. Gath on Wednesday 1st March to discuss her concerns.
As background you should be aware of the following. The Disabled Drivers and Disabled Passengers Scheme is designed to cater for a wide range of scenarios and allows for relief of up to €10,000 for adaptations, €16,000 for specific adaptations, and €22,000 for extensive adaptations. It is my Department’s understanding that this generally covers the needs of most of those who are eligible for the scheme.
These reliefs apply to Vehicle Registration Tax (VRT) and VAT on the purchase and adaptation of a car, whether new, second hand or imported. Revenue has indicated that Ms. Gath was approved for the scheme for extensive adaptations which carries a maximum upper limit of €22,000. They also confirmed that Ms. Gath had an exemption of €22,000 applied against VRT liability. This left a VRT balance due of €1,643. However, they also indicated that there was VAT due on the vehicle of €21,436, meaning that there is €23,372 in tax outstanding to the Revenue Commissioners.
It has always been a requirement that VAT is payable on the importation of new cars into the country, even prior to Brexit. The system operates in such a way that generally the purchase of the car in the UK is zero rated for VAT , and the VAT payment is made on the import into this country.
Unfortunately, whilst appreciating the difficulties that this VAT charge places upon Ms. Gath, I am not in a position under the current legislation to waive the payment of this sum, as it could create a precedent for the treatment of VAT on the import of new vehicles generally from the UK. This position is reinforced by the fact that VAT is a tax underpinned by EU legislation, and any waiver could lead to action being taken against Ireland by the EU Commission.
As indicated above, I propose discussing this matter with Ms. Gath on 1 March.