EU Commission to carry out review of rates

VAT on children’s clothes, the issue that infamously brought down a Fine Gael government, could soon be back on the agenda as the European Commission announces a review of all VAT rates.

Ireland has a range of low and zero VAT rates on goods and services that include food, heating, fuel and electricity, health and medical services, agriculture goods — and horses and greyhounds.

The current VAT regime across the EU is allows up to 12%, or €106 billion, of the take to disappear through fraud. This leads to extra costs for business and is interfering with a real open market in the EU, Tax Commissioner Algirdas Semeta has argued.