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Revenue to enforce 23% VAT on all Herbal Infusions.

Revenue to enforce 23% VAT on all Herbal Infusions.

Apr 13, 2014

Joerg Mueller

While teas from the tea plant Camelia Sinensis and coffee remain at 0% VAT rating, a 23% VAT rate is now enforced to all Herbal Infusions . Urgent lobbying needed to back track this decision.

Please help make this cause known by writing a letter to the minister (see following  letter and recent Irish Independent article).

To Minister John Perry & Michael Noonan

We are a small (but growing) speciality tea company with 7 employees based in Galway. I am writing to you to highlight recent enforcement of the 23% VAT rule for herbal teas/infusions.
We would strongly urge to include the herbal teas/infusions into the 0% category (or apply an equal VAT rate across the category) as:

1: From a consumer perspective herbal teas/infusions equal green tea (and are generally perceived as the healthy option), thus having green tea (ie coming from the tea plant camellia sinensis and being classified as 0% VAT) at 0 %, and for example Peppermint/Chamomile/Rooibos at 23% would confuse the end-consumer.

2: This will give rise to the perception that the healthy consumer choice (ie herbal teas are caffeine free) is being penalised, whereas black tea & coffee is at 0%.

3: While in contact with UK revenue, it was confirmed to me that within the UK jurisdiction, herbal tea/infusions will stay at 0%, which will put Irish Herbal Tea manufacturer's at a disadvantage (and food-service customer's might switch to products produced in Northern Ireland).

4: It should be in the interest of the government to stimulate consumption of healthy beverages, and not penalise them vs coffee for example

Kind regards,

Joerg Mueller

Solaris Botanicals Ltd