Plans to add 23% VAT to food supplements delayed until November

Plans to add 23% VAT to food supplements delayed until November
Olive Curan Chairperson IHTA Managing Director, Leader of the Labour Party Brendan Howlin, with Alan Martin IHTA Member, Jonathan Griffin Managing Director IHTA and Phil Costigan IHTA General Secretary outside Leinster House. Picture: Maxwell Photography

The Revenue Commissioners has delayed the introduction of an increased 23% VAT rate for food supplements until November 1, following a political outcry and protests outside the Dáil.

It said in light of the Minister for Finance Paschal Donohoe setting out plans to examine the policy and legislative options for the taxation of food supplements, it has confirmed that the "VAT treatment of food supplements will remain unchanged until 1 November 2019".

"Following growing concerns of industry representative bodies about the difficulties in distinguishing between food supplement products which could be zero-rated and those which should be standard-rated, Revenue undertook a comprehensive review on the VAT treatment of food supplements.

"Following the review Revenue issued new guidance in December 2018, applicable from 1 March 2019," the statement said.

The delay comes after Mr Donohoe wrote to Niall Cody, chairman of the Revenue Commissioners on Monday on the issue.

Labour and Solidarity/PBP TDs joined people outside Leinster House protesting at plans to hike up the costs of food supplements on Friday. The increase was decided last year.

More than 60,000 people have now signed a petition to stop the VAT being put on vitamins and mineral supplements on March 1.

Labour leader Brendan Howlin called the move a "stealth tax”.

He said consumers, patients and ordinary people would not be able to continue with their health routines.

The Labour leader also questioned how the change was being implemented without Dáil approval: “This is very scandalous and needs to be addressed."

And while there are some exceptions to the new pricing regime, parties reject claims that some of the products facing the extra 23% VAT charge are 'snake oil' products.

Independent TD Catherine Connolly has also told the Dáil the VAT move should be deferred: “For God's sake, do the right thing and make a practical decision."

Another Independent TD Noel Grealish, who the Government relies on for votes, wants the tax hike reversed.

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