Zero rate of VAT on domestic supply of PPE will contribute to national effort to combat Covid-19 – Donohoe

9th April, 2020

The Revenue Commissioners confirmed yesterday (Wednesday) that they had implemented an EU Commission decision that allows goods to combat COVID-19 to be imported, from outside the EU, free of import duties and VAT. In addition to this relieving measure, the Minister for Finance and Public Expenditure and Reform, Paschal Donohoe T.D., today (Thursday) announced that he has asked the Chairman to consider applying a zero rate of VAT to the domestic supply of personal protective equipment to frontline health staff in hospitals, and other health settings, to which the Chairman has agreed.

This follows confirmation from the EU Commission that, notwithstanding the provisions of the VAT Directive, Member States may apply flexibility on a temporary basis in relation to the rate of VAT applied to certain supplies specifically connected to the current crisis.  On that basis, the Minister has requested that Revenue considers applying the zero rate to personal protection equipment, ventilators and oxygen as necessary to combat COVID-19 when supplied to hospitals, nursing homes, GP practices and the like, for use in the delivery of Covid-19 related health care services to their patients.  It is envisaged that this concessional treatment will apply up to 31 July 2020, subject to review. 

Minister Donohoe said: ‘The relief in respect of domestic supplies will provide further assistance for those providing front line services. It will particularly benefit nursing homes, and other exempt activities, who are unable to reclaim their VAT inputs on domestic supplies. It is also an acknowledgement of the many domestic companies who are contributing to the national effort to tackle this crisis by reconfiguring their manufacturing capability to produce equipment essential to the national effort’.