Health food retailers, brand-owners and campaigners in Ireland have been celebrating a decision to defer the imposition a new 23% VAT rate on food supplements.
In December 2018 Ireland’s Revenue announced that a standard 23% VAT rate would be applied on all food supplements from 1 March 2019.
The announcement provoked a fierce defence of the current zero-rating applied to supplements Ireland: The issue has been raised in the Dáil – the lower house of the Irish Parliament – on several occasions; a Stop This VAT petition quickly gathered tens of thousands of signatures; and consumers, campaigners and industry figures have joined forces to take the protest onto the streets.
Industry fears that imposing VAT on food supplements, effectively forcing a substantial overnight price hike, would have a seriously detrimental effect on public health, especially among vulnerable groups such as the elderly and the very young.
The Revenue’s decision to defer implementation of the VAT application follows an intervention by Ireland’s minister for health, who said he ‘wanted to consult more widely on legislative provisions concerning the VAT treatment of products in this sector’.
The latest development has been welcome by Ireland’s independent health food retailers who say they are now urgently seeking a ‘permanent solution’ on the issue.