A High Court judge has found Revenue has not refused to grant a distillery tax break for alcohol it bought to make hand sanitiser for hospitals following the outbreak of the Covid-19 pandemic.
Judge Siobhan Phelan ruled that Arderin Distillery Ltd of Tullamore, Co. Offaly, which produces spirits including the Mor Gin range, had no legal standing to challenge the alleged refusal.
The distillery’s proceedings, aimed at overturning the alleged rejection when no actual decision was made, were “premature,” the judge ruled.
However, due to the health emergency that existed at the time, the judge was convinced that the distillery had a legitimate expectation of being entitled to the tax relief requested.
It was entitled to a declaration from the court that once it had determined to the satisfaction of the tax authorities that the alcohol it was importing was, and should be, used in the manufacture of hand sanitizer, it had such legitimate confidence in being granted the tax relief it sought. She said.
The company had claimed it was treated unfairly by the tax authority after the distillery began manufacturing an ethanol-based disinfectant for the HSE for use in hospitals in March 2020.
It claimed that alcohol is normally subject to excise duty in the form of the Alcohol Product Tax (APT). However, in certain circumstances, alcoholic products, including those used for medical purposes or in hospitals, do not have to pay the APT.
The distillery claims it ordered alcohol to make the disinfectant after being assured by a Treasury official in late March that it would not have to pay APT.
It also said it met all the requirements it needed to get APT.
Revenue denied the claims and had argued that the company’s lawsuit should be dismissed, in part because it never made a decision to deny or grant the company a tax break on the alcohol.
In its lawsuit, the distillery alleged that a tax authority official granted it an oral relief of up to 80,000 liters of alcohol for APT.
It claimed the alcohol used to make the hand sanitizer during the emergency subjected Arderin to an excise tax, or APT, of about €2.1 million.
The company sought various orders and explanations, including an order overturning the tax authority’s alleged refusal to grant the distillery duty exemptions.
Revenue alleged that it never approved a request for relief from the company for alcohol purchased by the company in March 2020 or that Revenue expressed satisfaction or approval that the company intended to use alcohol for an exempt purpose from the APT.
https://www.independent.ie/irish-news/courts/distillery-feared-excise-bill-after-shift-to-sanitiser-41637208.html Distillery feared excise bill after switching to disinfectant