The Commission has sent a letter of formal notice to Ireland as regards the application of a reduced rate of VAT on the supply of horses. While we are all aware of the expression “I could eat a horse”, a supply of horses is not normally intended for the generation or production of foodstuffs and so may not be allowed to be charged at a reduced rate.

A letter of formal notice on the same issue has also been sent to Austria, the Czech Republic, France, Germany, Italy and Luxembourg.

In addition, the Commission has formally requested the Netherlands to amend its legislation with regard to the reduced VAT rate it applies to certain live animals, and in particular horses. The following quote from the Commission press release summarises the problem:

• “According to the VAT Directive (Annex III of the Directive 2006/112/EC), only a limited list of supplies of goods and services may be subject to reduced rates of VAT. Included in that list are foodstuffs for human and animal consumption as well as live animals, seeds, plants and ingredients normally intended for use in the preparation of foodstuffs. Supply of horses not normally intended for the generation or production of foodstuffs is not included in this exhaustive list.”

Further information is available at http://europa.eu/rapid/pressReleasesAction.do?reference=IP/07/1545&format=HTML&aged=0&language=en&guiLanguage=en.