Charities group to make case for VAT exemption

8th November 2006, Irish Times
Mark Hennessy
Political Correspondent

The Government's argument that charities must pay VAT under European Union rules does not stand up to scrutiny, a number of charities will today tell an Oireachtas committee.

Last month, Minister for Finance Brian Cowen said he could not offer charities any concessions because new exemptions were barred under 30-year-old legislation introduced when Ireland joined the EU.

The Irish Charities Tax Reform Group will today make a presentation to the Oireachtas Finance and Public Service Committee chaired by Fianna Fail TD Sean Fleming.

The European Commissioner for Taxation and Customs, Laszlo Kovacs, made it clear last year that any concessions to charities were compatible with EU law as long as they were clearly separated from the VAT system.

In Denmark, the government has agreed to a system that will allow Danish charities to claim back VAT.

The Irish Cancer Society said its €300,000 VAT bill would pay for the entire cost of its cancer public information campaign, including the hiring of eight nurses to help patients in hospital.