Revenue delay increase in VAT rate on food supplements

March 1, 2019

On 27 December 2018, Revenue issued an eBrief advising of a change in Revenue practice on the VAT rate applicable on sales of certain food supplements.  The eBrief advised the VAT rate was to be increased to 23% from 0% with effect from 1 March 2019, effectively withdrawing a concession that had been long standing.  The concession treated the food supplements as food for VAT purposes and so the supplements were zero rated.  Revenue have stated that they sought to withdraw the concession as they consider that it is being abused.

It is understood that over 60,000 people signed a petition asking for the concession to be reinstated and there was a discussion on Liveline.

On 26 February 2019, Revenue advised that they were delaying the start date to 1 November 2019, further to the Minister for Finance writing to the Chairman of the Revenue Commissioners setting out his plans to conduct a review to examine the position and to consider the legislative options.  There is to be a public consultation over the next few months so that appropriate legislation can be drafted as part of Finance Bill 2019.