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No to 23% VAT increase on food supplements

February 11, 2019

No to 23% VAT increase on food supplements content

A 23% VAT increase on food supplements was due to be introduced on March 1, 2019. On behalf of our members, Fighting Blindness wrote to the Department of Health, Department of Finance and the Revenue in early 2019 to raise concerns over this increase and the impact that it would have on people living with sight loss.

We requested an immediate review of this decision by the Revenue Commissioners and intervention from the Departments of Health and Finance on the matter. Similar concerns were raised by many other groups and by the health food industry.

As part of our opposition to the proposed increase we prepared a letter for our members to send to their local TDs. We asked people to bring to their attention the impact such a significant increase in these already expensive supplements would have on people living with sight loss, many of whom have been recommended by their doctors to slow down the progression of their condition. Thank you to everyone who raised the issue with their TD or signed a petition – your voice matters!

After mounting public pressure, the increase was deferred until November 1, 2019 pending review by the Minister for Finance with input from the Minister for Health and a proposed public consultation.

The “Public Consultation on the VAT Treatment of Food Supplement Products” was open during April and May 2019. Fighting Blindness made a submission to this process highlighting the concerns raised by our members. Our submission made it clear that we strongly believe and advocate that in cases where supplements are evidence based and recommended for use by a medical doctor, the VAT rate should remain at zero.

However, the guidance document for the consultation stated that there is no legal provision that would allow a zero rate to continue to be applied to food supplement products. As such some form of increase in the VAT rate is inevitable and will come into effect on November 1, 2019. The consultation document asked a number of questions about what form that increase should take. Fighting Blindness agreed that a reduced rate of VAT should be applied to all types of food supplement products. The full submission is available to download as a Microsoft Word document via this link and as a PDF document via this link.

Food supplements for sight loss

One of the most commonly used eye supplements are those used to slow the progression of age-related macular degeneration (AMD). Seven per cent of Irish people aged 50 years or older are living with AMD. It is the leading cause of sight loss in this age group, with the number of people affected due to increase in the coming years due to our aging population.

What is age-related macular degeneration (AMD)?

AMD affects a tiny part of the retina at the back of the eye called the macula, which is responsible for all our central vision, most of our colour vision and our ability to see in fine detail. The macula plays an essential role in everyday activities such as reading, watching television, driving and recognising faces. In AMD, deterioration of the macula causes the gradual loss of central vision and makes vision distorted or blurry.

Over time, it may cause dark patches in the centre of vision. The severity of this condition varies from person to person. Some studies have shown that taking a supplement containing vitamins C and E, zinc, copper, lutein, and zeaxanthin can help slow down the progression of disease.

Impact of VAT introduction?

In the past, these supplements for AMD were available on the Discretionary Hardship Scheme. This arrangement was phased out in 2016 and as of January 2017 supplements for AMD were completely removed from the scheme. With the Revenue’s decision to introduce a VAT rate of 23% on these items, the already costly supplements will increase further in price, and quite significantly.

A 2017 study in the British Journal of Ophthalmology evaluated the cost-effectiveness of food supplements used by sub-groups of people with AMD. It found the supplement use to be cost saving and recommended that it be publicly funded. Not only is the supplement not funded for any person in Ireland, it is now to be subject to the highest possible rate of VAT, making them too expensive for some people to buy.

There is currently no treatment available for Dry AMD. These food supplements, along with lifestyle changes, are the only option for people affected. The treatment for Wet AMD is an injection directly into the eye, frequency of injections will vary for each person and is determined by an ophthalmologist. These injections are very costly and require significant clinical time in an ophthalmology service that is already overstretched and dealing with some of the longest waiting lists of any speciality in the health service. They also place significant burden on the patient. Slowing the progression of the disease and delaying the need for injections is an important part of the treatment of AMD.

Cora has been living with AMD for four years and takes a supplement to slow the deterioration of her vision, to date her condition has not progressed to the stage where she needs regular eye injections. “Revenue now want to tax the only ‘treatment’ available to me. The 23% increase will mean an extra €6.44 on the €28, 30-day pack that I use. I am a fit and healthy widowed OAP with limited funds, my health and independence are very important to me. I have no wish to become a burden on my family.”

Vision impairment can have a significant impact on quality of life and independence, and is associated with higher rates of depression, greater risk of falls, and premature admission to a nursing home. It also places significant burden on the health system and the State. The financial cost of vision loss to the departments of health, social protection and finance was €205 million in 2010. Studies have shown that that these supplements may help reduce the risk of progression of early AMD to late-stage AMD where costly treatment is required.

On behalf of our members and the sight loss community in Ireland, Fighting Blindness remains opposed to the increase in VAT on these supplements.

For more information please contact the Advocacy department on 01 678 9004 or advocacy@fightingblindness.ie.

References

Prevalence of age-related macular degeneration in the Republic of Ireland https://bjo.bmj.com/content/99/8/1037

The cost of sight loss: the economic impact of vision impairment and blindness in the Republic of Ireland: summary report https://www.lenus.ie/bitstream/handle/10147/300393/CostofSightLossSummaryRept.pdf?sequence=1&isAllowed=y

The Economic Cost and Burden of Eye Diseases and Preventable Blindness in Ireland, Deloitte Access Economics, Deloitte Consulting, 2014.

A Randomized, Placebo-Controlled, Clinical Trial of High-Dose Supplementation With Vitamins C and E, Beta Carotene, and Zinc for Age-Related Macular Degeneration and Vision Loss AREDS Report No. 8 https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1462955/

Lutein + Zeaxanthin and Omega-3 Fatty Acids for Age-Related Macular Degeneration The Age-Related Eye Disease Study 2 (AREDS2) Randomized Clinical Trial https://jamanetwork.com/journals/jama/fullarticle/1684847