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Criticism of 23% VAT hike on food supplements

There has been criticism of a decision by the Revenue Commissioners to put 23% VAT on food supple...
Jack Quann
Jack Quann

12.35 26 Feb 2019


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Criticism of 23% VAT hike on f...

Criticism of 23% VAT hike on food supplements

Jack Quann
Jack Quann

12.35 26 Feb 2019


Share this article


There has been criticism of a decision by the Revenue Commissioners to put 23% VAT on food supplements.

This is a 23% increase, as there is currently no VAT rate on food supplements sold in Ireland.

Revenue announced in December last year that VAT would be applied on all food supplements from March 1st of 2019.

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However Labour leader Brendan Howlin has said this will endanger jobs.

He said: "Small businesses in towns across the country are preparing for the potential disaster of a sudden exit of the UK from the European Union.

"Now is the time for Government to support small businesses, and to reinforce the viability of towns for shopping and services.

"It seems incredible that the Minister for Finance [Paschal Donohoe] is sitting on his hands while a Revenue decision threatens the jobs and livelihoods of those involved in health food stores.

"Historically, Revenue has applied the zero rate of VAT to all sorts of food supplement that people take since the 1970s, except those associated with sports or slimming.

"Revenue has recently announced a new interpretation of the VAT rules, which amounts to a change of policy without Government approval."

"Minister Donohoe has insisted that he cannot interfere with Revenue's operations. This is not true.

"The minister is the policy maker. Revenue's job is to implement policy, not to make policy or to change policy."

The Irish Health Trade Association (IHTA) has called on the Revenue Commissioners and the Government to defer this decision.

It has also asked the Government to ensure that whatever steps they take will recognise the legal status of food supplements as foods under EU law, and involve appropriate consultation with the industry.

It said: "Since 2011 the Revenue Commissioners have been questioning whether all food supplements should be entitled to the concessionary rate.

"In December of last year they asked the minister to apply a reduced rate of VAT on all food supplements in the Budget, but the minister decided to take advice on the matter before potentially legislating in the next year's budget; whereupon the Revenue Commissioners decided that they would under their own cognisance apply the standard rate of VAT (23%) on all food supplements from the 1st of March.

"The Health Product Industry considers that that it is not acceptable for any institution of the State to take unilateral action of this nature when the Government has stated that it is considering legislation on a matter".

According to an iReach survey commissioned by the IHTA, in 2018 71% of Irish people bought vitamin, mineral and other food supplements all year round - with 73% of those regular consumers doing so to "maintain and improve ongoing adult health."


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Brendan Howlin Food Supplements Health Food Sector Revenue Commissioners VAT VAT Increase VAT Rate On Food Supplements

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