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Flat-rate scheme for farmers
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47. (1) The Principal Act is amended—
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(a) in section 68 by inserting the following after subsection (5):
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“(6) An invoice, settlement voucher or other document provided for in this section or in section 86(1) shall not issue in respect of supplies of a kind specified in an order made under section 86A.”,
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(b) in section 86—
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(i) by substituting the following for subsection (1):
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“(1) Subject to section 68(1) and (6) and subsection (1A), where a flat-rate farmer supplies agricultural produce or an agricultural service to a person, the farmer shall issue to the person an invoice indicating the consideration (exclusive of the flat-rate addition) in respect of the supply and an amount (in this Act referred to as a ‘flat-rate addition’) equal to 5.4 per cent of that consideration (exclusive of the flat-rate addition).
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(1A) Where section 68(6) applies, the issue of an invoice by a flat-rate farmer shall only apply in respect of agricultural produce or an agricultural service of a kind not specified in an order made by the Minister under section 86A.”,
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and
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(ii) in subsection (2) by substituting the following for “transaction.”:
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“transaction other than where an order has been made by the Minister under section 86A relating to such supply of produce or service.”,
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(c) by inserting the following section after section 86:
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“Restriction of flat-rate addition
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86A. (1) Where, following a review carried out by the Revenue Commissioners in relation to a particular agricultural sector and having regard, in particular, to the business structures or models employed and the nature of the relationships and contractual arrangements in place between parties in the sector, the Minister is satisfied that the application of the flat-rate addition in accordance with section 86 in respect of supplies of agricultural produce or agricultural services within that sector has resulted in, and if that application were retained would continue to contribute to, a systematic excess of the amount of flat-rate addition payments over the amount of non-recoverable tax on input costs borne by flat-rate farmers within that sector, the Minister may by order provide that the flat-rate addition shall not apply to supplies of a kind to be specified in the order.
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(2) In subsection (1), ‘non-recoverable tax on input costs’ means tax which would be deductible in accordance with section 59 if the flat-rate farmers in the particular agricultural sector were registered for value-added tax, less tax which is recoverable by flat-rate farmers in that sector in accordance with a refund order made under section 103.
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(3) An order made under this section shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annulling the order is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the order is laid before it, the order shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.”,
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and
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(d) in section 115 by inserting the following after subsection (3):
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“(3A) A person who issues an invoice, settlement voucher or other document provided for in section 68 or 86 in which an amount of flat-rate addition is stated in respect of supplies of goods or services which are the subject of an order made under section 86A shall be liable to a penalty of €4,000.”.
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(2) This section shall come into operation on 1 January 2017.
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