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Government says it can't remove VAT on defibrillators

“Taxing defibrillators is like putting a tax on saving lives”: the 23 per cent VAT rate which Government says can’t be lifted because of an EU directive.

Image: REDAV via Shutterstock

THE GOVERNMENT HAS said that a 23 per cent VAT rate is to remain on life-saving defibrillators – because their hands are tied by an EU VAT directive.

Earlier this week, TheJournal.ie reported that 19 lives had been saved at Dublin Airport as a result of the introduction of defibrillators there ten years ago. Three lives alone were saved in 2012, including that of an 85-year-old man who returned recently with his family to thank emergency crews.

The Irish Heart Foundation estimates that sudden cardiac death (SCD) kills more than 5,000 people in Ireland each year, including around 100 people under the age of 35.

Dublin Airport is just one of a number of venues around Ireland to be designated a Heartsafe area by the Irish Heart Foundation. The award is designated to communities, schools, workplaces and healthcare facilities where steps have been taken to implement a programme and facilities which help improve the chance of survival of people who suffer a cardiac event. Forty-two groups around Ireland have so far been named Heartsafe venues.

“Chain of survival”

The “chain of survival” promoted by the IHF emphasises the need for several steps in the response to a cardiac arrest, especially the need for members of the public to train in CPR and to administer it as soon as someone collapses. Another part of the chain is the access to defibrillation. As a result, many sports organisations and other groups have fundraised in recent years to buy a defibrillator for their communities.

However, such defibrillators are subject to a 23 per cent VAT rate. Alex White, minister of state at the Department of Health, this week told the Dáil that there is an EU VAT directive which prevents the Government from remove the VAT rate from defibrillators. It also is “constrained” from reducing the VAT rate because while such a reduction is provided for under the same directive, it applies only to medical equipment used exclusively for personal use of someone with a disability. “It does not include defibrillators for general use by voluntary and charitable groups,” he said.

Ciarán Lynch, Labour TD for Cork South Central, suggested to the junior minister that, if VAT laws cannot be amended, that the Department of Health provide some compensation to charitable groups to make up the amount they are forced to pay in VAT. He said:

While I accept that VAT regulations do not allow the Government to waive the VAT requirement, it is perfectly feasible for the government to refund VAT moneys collected from voluntary groups and sporting organisations in the performance of what is a civic duty.

He noted that a 2004 study carried out by the Department of Health recommended that defibrillators and similar potentially lifesaving devices should be “widely available”, especially in sporting venues. He added:

Studies of sudden cardiac death have shown that the time between sudden cardiac arrest and defibrillation is the most critical factor for survival. Medical research shows there is an 80 per cent chance of survival if a defibrillator reaches the victim within two minutes. The same research also demonstrates that the survival rate reduces by approximately 10 per cent for every minute that passes before defibrillation.

Although the survival rate of out-of-hospital cardiac arrest is approximately 7 per cent in Ireland, it should be noted that 123 people were saved as a direct result of the use of defibrillators in the 12 months prior to October 2012. These individuals are still alive as a direct result of having access to defibrillators immediately after experiencing a heart attack.

Alex White said that while he appreciated the health concerns regarding the provision of defibrillators, the proposal to refund charitable organisations for the VAT paid on them would generally not be possible. While there are some cases under which VAT can be refunded, he said that “a defibrillator purchased for general use by a charity or voluntary body would not qualify for a refund under this order”.

“No VAT exemption for charities and sporting and voluntary bodies”

He said that while the refunds proposed by Lynch would not be possible, “Exchequer funding is separately made available to such organisations”. In addition, he added, “the Irish tax code also provides an exemption from various taxes for charities and certain sporting and voluntary bodies, including an exemption from VAT on supplies”.

Dominic Hannigan, Labour TD for Meath East, had previously raised the issue in the Dáil with Minister Noonan, who replied in November last year that “there is no provision in VAT law that would make it possible to exempt from VAT or apply a zero rate to the supply of such products”.

The Irish Heart Foundation (IHF) has also previously included a call for the removal or reduction of the VAT rate on defibrillators as part of a pre-Budget submission to the Government. Chris Macey, Head of Advocacy for the IHF, told TheJournal.ie that the organisation “cannot stress enough the importance of having more defibrillators in communities around Ireland combined with volunteers who know CPR (cardiopulmonary resuscitation)”. He continued:

Every year about 5,000 people die from sudden cardiac death here and about 100 of these happen to people under the age of 35 years. Our message is simple: with more defibrillators and CPR, more lives can be saved. In fact, 123 people were saved as a direct result of the use of defibrillators in the 12 months up to October 2012.

But taxing defibrillators is like putting a tax on saving lives. We need the government to push back at EU level to address this anomaly to remove the VAT barrier for groups and encourage the continued roll-out of lifesaving initiatives like our Heartsafe programme which promotes recognised standards in CPR and in the use of defibrillators in all communities around Ireland.

Community campaigners Beating Again have been canvassing for removal of the VAT rate on defibrillators since last year and received a response from Tanaiste Eamon Gilmore last year in which he said he was bringing the campaign to the attention of Finance Minister Michael Noonan “for his consideration”.

“You can’t put a price on somebody’s life”

Jim Hartnett, who runs the online campaign on the Beating Again Facebook page with Alan Coleman, is a trained EMT (emergency medical technician). He said that he and Coleman wrote to every TD in the country and that the issue has also been raised at the European Commission by Fianna Fáil MEP for Leinster Liam Aylward.

Hartnett first became aware of the VAT rate imposed on defibrillators when he spotted it on an invoice. “It doesn’t make any sense,” he said. “My argument would be that you can’t put a price on somebody’s life. If you save someone’s life – and we see this happening a lot on sports pitches, to younger people – then there is this benefit of this person going on to live a long and productive life.” He said:

The gain would be a lot more than the loss of the VAT on a machine.

While Hartnett said that he and Coleman were continuing to push on the VAT issue, they also have a long-term goal to fundraise for the provision of more defibrillators for communities, clubs and groups. Heartbeat Safety in Kildare has also offered to supply reconditioned defibrillators at a lowered cost. These, says Harnett, are surplus stock that have never been used on a person and are fitted with new pads, gels and batteries.

Read: 19 lives saved since introduction of defibrillators at Dublin Airport>

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