Package rule
14/08/1979
Query
What rate of VAT applies to a service charge made in respect of door-to-door milk deliveries?
Decision
The zero rate of VAT applies, as the service charge is seen as inclusive in, and incidental to, the supply of milk.
Value Added Tax
Section 11(3), Value Added Tax Act, 1972
Origin: Indirect Taxes Policy and Legislation
File ref:A/417
19/12/1990
Query
Where films (liable at the standard rate) are sold with processing costs (liable at 12.5%) included, does the package rule apply, whereby the entire supply is liable at the higher rate of VAT?
Decision
An apportionment of the consideration on a 50/50 basis between that due on the supply of the film, and due on the processing, is allowed. Therefore, 50% of the consideration is liable at the standard rate of VAT, and 50% is liable at the reduced rate of VAT.
Value Added Tax
Section 11(3), Value Added Tax Act, 1972
Origin: Indirect Taxes Policy and Legislation
File ref:A/108
21/06/1994
Query
Whether the package rule applies to the supply of a (musical) card and lottery ticket packaged together for a single consideration.
Decision
An apportionment is allowed whereby a calculated consideration in respect of the retail value of the card is liable to VAT at the standard rate, and the balance of the consideration is exempt from VAT.
Value Added Tax
Section 11(3), Value Added Tax Act, 1972
Origin: Indirect Taxes Policy and Legislation
File ref:A/430 (B)
26/07/1994
Query
Whether the inclusion of a small bottle of wine with tubs of spread in a marketing campaign for an all-inclusive price makes the whole supply liable at the standard rate of VAT?
Decision
Provided the items were listed separately on the invoice, showing the different rates of VAT applying to each, the package rule was not invoked.
Value Added Tax
Section 11(3), Value Added Tax Act, 1972
Origin: Indirect Taxes Policy and Legislation
File ref:A/268
02/03/1995
Query
Whether the package rule applies to food hampers that contain goods rated variously at the standard and reduced rates of VAT.
Decision
Provided that the supplier keeps an accurate record in his books of the goods supplied at the various rates of VAT, apportionment of the rates is allowed as though the goods were supplied singly.
Value Added Tax
Section 11(3), Value Added Tax Act, 1972
Origin: Indirect Taxes Policy and Legislation
File ref:A/430 (A)