Immediate release: 10 October 2017
Issued by The Wheel
BUDGET 2018: VAT REFUND SCHEME A BREAKTHROUGH FOR CHARITIES
The Wheel, Ireland’s largest representative body for charities, today welcomed the announcement by Minister for Finance and Public Reform, Paschal Donohoe, TD that a VAT refund scheme for charities is to be introduced.
Commenting on the announcement, Ivan Cooper, Director of Public Policy at The Wheel said:
“Today’s announcement is a breakthrough for charities who have been campaigning for such as scheme for decades. The Vat rebate provided through this scheme will be reinvested in vital services in areas like housing, health and social care.”
Mr Cooper acknowledged “the clear commitment of Minister Donohue to resolving this long-standing anomaly, following discussions with the Wheel at both the National Economic Dialogue and the recent pre-Budget presentation to him by the Wheel as part of the Community and Voluntary pillar.
“The support of Independent TD, Michael Harty, Independent Ministers Zappone and Naughton and backing of all the main Opposition parties also emphasised the widespread recognition of this measure as being necessary to assist charities in delivering their services,” he said.
Examples of how charities are currently impacted by VAT include:
- Special Olympics Ireland will host the All Ireland Games in Dublin next year at an extra cost to the organisation of €2.28m, of which €415,000 of that will go back to the exchequer in unreclaimable VAT.
- The North and East Housing Association recently built nine houses in north county Dublin at a cost of €1.25m. On top of this, the association paid €172,980 in unreclaimable VAT - more than the cost of another family home.
- MS Ireland, which provides frontline services for people with multiple sclerosis, pays an average of €117,090 each year, enough for an additional physiotherapist and MS nurse in their respite centre.
In its pre-Budget submission, The Wheel called for a VAT rebate scheme capped at €20m to deliver an effective 50% VAT rebate to the sector. This built on previous work undertaken by the Irish Charities Tax Reform Group.
An anomaly in EU tax law prevents charities reclaiming VAT expenses. To address the issue, the EU Commission approved a ‘refund mechanism’ at national level. Today’s announcement comes two years after former Finance Minister, Michael Noonan, published a specially commissioned Budget report on unreclaimable VAT paid by charities
Ivan Cooper, Director of Public Policy at The Wheel is available for interview. For more information, call Gert Ackermann on
Tel: 086 176 9287 or email gert@wheel.ie
NOTE TO EDITOR:
About The Wheel
The Wheel is Ireland’s largest representative body in the charity sector, with over 1300 members. We are a representative voice and a supportive resource that offers advice, influence and advocacy for community, voluntary and charitable organisations.
