Is Ireland allowed place tax on any imports from other EU states?

IrishJack89

I'm just wondering is Ireland allowed place a tax certain imports or is EVERYTHING tax free under the EU internal market.. I'm wondering are chemical substances or anything along those lines allowed to be taxed?

seamus

VAT cannot be applied to items if VAT has already been applied to the item when sold elsewhere in the EU.

If the product has been purchased VAT-free elsewhere in the EU, then the retailer must charge Irish VAT on them.

Some products are controlled within the EU for the purposes of import for sale such as tobacco and alcohol, where Irish excise must be paid on them.

You would need to be more specific to get a specific answer. In general if you purchase something from another EU country for your own personal use, then you pay VAT in the country of origin and no other taxes are due.

IrishJack89

Well I have been asked if Ireland could place on products from other EU countries that have a minimum potassium content of 5%. As far as I can see that would be against EU law but after doing a bit of reading I'm after getting confused..

beeftotheheels

IrishJack89 wrote: »

Well I have been asked if Ireland could place on products from other EU countries that have a minimum potassium content of 5%. As far as I can see that would be against EU law but after doing a bit of reading I'm after getting confused..

Okay. First things first. Does Ireland, under its domestic law, levy a tax on those products?

If yes, what is that tax? Is it VAT, customs duty, other?

If it is VAT then check out if it is in accordance with the VAT directives. If it is a customs duty or other then check to see if there are any applicable directives there.

Then, head to the treaties. Even if something is legal under a directive it might still be illegal under the treaties.

Is the tax only being levied on imports or is it being levied on all products meeting the criteria? In order to invoke the treaties you must have similar situations being treated differently, or different situations being treated similarly. In essence you must be able to point to some discrimination, overt or covert. If the tax is levied on products which are not produced in Ireland that won't be enough to render the tax illegal e.g. VRT is on all cars, all cars are imported but if I started building cars tomorrow they'd still be subject to VRT so the tax is not discriminatory despite the fact that it is currently only applied to products that are imported.

If you determine that there is discrimination then the next step is to determine whether that discrimination can be justified under the treaties and the grounds for justification will depend on which articles of the treaties you conclude have been breached.

And before doing any of this other than determining whether there is a charge under domestic law check that the amount at stake is sufficient to warrant both the detailed investigation required and the potential costs and time delay of taking a law suit. I've never known Revenue to settle an EU tax matter where the tax at stake was less than seven figures and thus the taxpayers' willingness to pursue legal action was clearly not in doubt.

GerardKeating

IrishJack89 wrote: »

I'm just wondering is Ireland allowed place a tax certain imports or is EVERYTHING tax free under the EU internal market.. I'm wondering are chemical substances or anything along those lines allowed to be taxed?

Depends on the product/chemical. The levy Customs/Excise Duty etc on certain products and VRT on cars.

Carawaystick

seamus wrote: »

VAT cannot be applied to items if VAT has already been applied to the item when sold elsewhere in the EU.

irish VAT is charged on cars bought outside the state if they're less than 6 months old, even if vat was paid at the time of sale.


There are EU states with parts of them outside the EU- the Netherlands and France and Spain, and either Sweden or Finland, and Italy off the top of my head.

There's excise duty on things manufactured in the EU imported into Ireland, as mentioned earlier.

Coal or Oil ( till Cork gets it's ball rolling) get a carbon tax applied

Do you mean potassium content by mass or by volume?

IrishJack89

Carawaystick wrote: »

irish VAT is charged on cars bought outside the state if they're less than 6 months old, even if vat was paid at the time of sale.


There are EU states with parts of them outside the EU- the Netherlands and France and Spain, and either Sweden or Finland, and Italy off the top of my head.

There's excise duty on things manufactured in the EU imported into Ireland, as mentioned earlier.

Coal or Oil ( till Cork gets it's ball rolling) get a carbon tax applied

Do you mean potassium content by mass or by volume?

I mean potassium content by percent, anything with a potassium content of more then 5%. Bananas is the import I'm talking about.
I have been asked if the government would be allowed to place a 20% tax on Bananas imported from other EU member states. Is this illegal or whats the story?

beeftotheheels

IrishJack89 wrote: »

I mean potassium content by percent, anything with a potassium content of more then 5%. Bananas is the import I'm talking about.
I have been asked if the government would be allowed to place a 20% tax on Bananas imported from other EU member states. Is this illegal or whats the story?

Why would you think it might be illegal? If a law is introduced that applies to all bananas, be they ripened here or otherwise, if it is applied across the board then on what basis might it be illegal (other than a potential charge under the VAT directives)?

Ireland produces no bananas (like most of the EU) but ripens huge numbers.

However, if the tax was designed to exempt Fyffes and other Irish operators then the tax might be illegal under EU law, or alternatively the exemption afforded to Irish producers might be what could be illegal.

There is no easy yes or no answer to this one, you'd need a lot more detail, and if you're not considering the VAT directive route at a minimum you'd need to find some discrimination before even thinking about the legality of the tax.

IrishJack89

beeftotheheels wrote: »

Why would you think it might be illegal? If a law is introduced that applies to all bananas, be they ripened here or otherwise, if it is applied across the board then on what basis might it be illegal (other than a potential charge under the VAT directives)?

Ireland produces no bananas (like most of the EU) but ripens huge numbers.

However, if the tax was designed to exempt Fyffes and other Irish operators then the tax might be illegal under EU law, or alternatively the exemption afforded to Irish producers might be what could be illegal.

There is no easy yes or no answer to this one, you'd need a lot more detail, and if you're not considering the VAT directive route at a minimum you'd need to find some discrimination before even thinking about the legality of the tax.

Cheers for the reply. But if Ireland placed a tax of 20% on bananas who would have to pay the tax? Would it be those from the other member states or would it be the individual here in Ireland who trying to import them?

beeftotheheels

IrishJack89 wrote: »

Cheers for the reply. But if Ireland placed a tax of 20% on bananas who would have to pay the tax? Would it be those from the other member states or would it be the individual here in Ireland who trying to import them?

That depends on the tax. If the Government brings in the tax then the legislation providing for the tax will have to set out what the tax is being charged on and who is liable etc

If someone set you this question they should have provided you with sufficient detail to actually be able to consider the issue because at an academic level without actual tax legislation in front of you you could write a thesis on this, and since I'm assuming that this is an essay rather than a thesis you need a lot more information to narrow down the question.

IrishJack89

beeftotheheels wrote: »

That depends on the tax. If the Government brings in the tax then the legislation providing for the tax will have to set out what the tax is being charged on and who is liable etc

If someone set you this question they should have provided you with sufficient detail to actually be able to consider the issue because at an academic level without actual tax legislation in front of you you could write a thesis on this, and since I'm assuming that this is an essay rather than a thesis you need a lot more information to narrow down the question.

Its not a thesis, just have to write a general 350 word account advising the Minister for Finance who is worried "that this measure may amount to an illegal customs duty or a charge of an equivalent effect". The whole purpose of the tax is to raise revenue for the government.

beeftotheheels

IrishJack89 wrote: »

Its not a thesis, just have to write a general 350 word account advising the Minister for Finance who is worried "that this measure may amount to an illegal customs duty or a charge of an equivalent effect". The whole purpose of the tax is to raise revenue for the government.

350 words? Pah, you couldn't produce a meaningful answer at that so restrict yourself to just Arts 34 & 36.

Under Art 34 is it a measure equivalent to a quantitative restriction? If yes, can it be justified under Art 36.

Since in posing this question your teacher has no knowledge of the Irish banana industry so make a few assumptions which bear no resemblance to reality in order to make your analysis easier but go and read the articles and the cases on those articles.

MagicSean

Call it a banana registration tax, or BRT, and tell him that it isn't a tax on imports but a tax on the registration of each banana for consumption in Ireland.

IrishJack89

beeftotheheels wrote: »

350 words? Pah, you couldn't produce a meaningful answer at that so restrict yourself to just Arts 34 & 36.

Under Art 34 is it a measure equivalent to a quantitative restriction? If yes, can it be justified under Art 36.

Since in posing this question your teacher has no knowledge of the Irish banana industry so make a few assumptions which bear no resemblance to reality in order to make your analysis easier but go and read the articles and the cases on those articles.

Cheers for your help. If I listened in class it would probably be a bit clearer too. What springs to mind though is that case where your man was importing garlic but had it labelled as apples for tax purposes. Then again I think he was importing from outside the EU..

Predalien

beeftotheheels wrote: »

Why would you think it might be illegal? If a law is introduced that applies to all bananas, be they ripened here or otherwise, if it is applied across the board then on what basis might it be illegal (other than a potential charge under the VAT directives)?

Ireland produces no bananas (like most of the EU) but ripens huge numbers.

However, if the tax was designed to exempt Fyffes and other Irish operators then the tax might be illegal under EU law, or alternatively the exemption afforded to Irish producers might be what could be illegal.

There is no easy yes or no answer to this one, you'd need a lot more detail, and if you're not considering the VAT directive route at a minimum you'd need to find some discrimination before even thinking about the legality of the tax.

It is not necessary for a tax to be solely applied to imports for it to breach free movement principles, it depends on the product and whether or not
taxing a certain item would have a greater impact on goods that are mostly imported rather than domestic products. It is possible for a tax applied across the board to indirectly hinder trade and thus breach treaty principles.

castie

MagicSean wrote: »

Call it a banana registration tax, or BRT, and tell him that it isn't a tax on imports but a tax on the registration of each banana for consumption in Ireland.

I like it!

but you would probably have to force all irish bananas to be registered to so that its equal treatment just no real charge.

Victor

Can special taxes rates be applied to specific products or types of products, e.g. can plastic boxes be given a non-standard tax rate, provided it isn't seen to be discriminatory?

There are pseudo-taxes like the various environmental levies, e.g. landfill charge and plastic bag levy.

IrishJack89 wrote: »

I mean potassium content by percent, anything with a potassium content of more then 5%. Bananas is the import I'm talking about.

Bananas have a potassium content in the order of 0.36% - you are overstating it by a factor of 150.