FINANCE (No. 2) ACT, 1966

AN ACT TO CHARGE AND IMPOSE CERTAIN DUTIES OF INLAND REVENUE, TO AMEND THE LAW RELATING TO INLAND REVENUE AND TO MAKE FURTHER PROVISIONS IN CONNECTION WITH FINANCE. [13th July, 1966.]

BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS:

1 Interpretation.

1.—(1) In this Act, save where the context otherwise requires—

“manufacturer” means a person who carries on in the State a business of making goods or generating electricity or of applying any process in the course of the making of goods or the generation of electricity;

“materials” means, in relation to a manufacturer, goods to which some process is applied by him by way of business in the course of the making of goods, or which are used by him as aforesaid as parts of or accessories for the goods made, or are used directly in the production process but do not become ingredients of the goods;

“regulations” means regulations under section 52 of the Finance Act, 1963;

“selling by retail” means selling goods by way of business otherwise than by wholesale;

“selling by wholesale” means selling goods of any class to a person who sells goods of that class in the course of business;

“taxable goods” means goods the sale of which is not an exempted activity within the meaning of section 3 (5);

“wholesale tax” has the meaning specified in section 2;

reference to persons accountable and accountability in relation to wholesale tax shall be construed by reference to section 3.

• (2) Any reference in this Act to any other enactment shall, except so far as the context otherwise requires, be construed as a reference to that enactment as amended by or under any other enactment, including this Act.

2 Charge of wholesale tax.

2.—With effect on and from the 1st day of October, 1966, a tax (in this Act referred to as wholesale tax) shall, subject to this Act and regulations, be charged, levied and paid—

• (a) on moneys received in respect of the sale of goods sold in the course of business (including goods sold before the 1st day of October, 1966), and

• (b) on goods imported into the State.

3 Persons accountable.

3.—(1) The person accountable for and liable to pay wholesale tax shall be the seller of goods, provided that the following persons shall not, save as otherwise provided by this Act, be accountable—

• (a) sellers who are not engaged in selling by wholesale taxable goods or whose monthly receipts from selling by wholesale taxable goods have not in any month exceeded, and are not likely in any month to exceed £500, but excepting any such seller who is—

• (i) a manufacturer, or

• (ii) a person who makes, for the purpose of a business of selling by retail carried on by him, purchases of taxable goods which in value and character are such as in the ordinary course of trade are made by wholesale merchants, and

• (b) manufacturers whose monthly receipts from selling taxable goods have not in any month exceeded, and are not likely in any month to exceed, £150.

• (2)
• (a) Where a person has not been accountable for wholesale tax by virtue of subsection (1) (a) of this section and the moneys received by him from selling by wholesale taxable goods exceeded £500 in each of two successive months, he shall become accountable for wholesale tax immediately on the expiration of the second month.

• (b) Where a person has not been accountable for wholesale tax by virtue of subsection (1) (b) of this section and the moneys received by him from selling taxable goods exceeded £150 in each of two successive months, he shall become accountable for wholesale tax immediately on the expiration of the second month.

• (3) A manufacturer who is not an accountable person under the foregoing provisions of this section shall, subject to such conditions as may be specified by regulations, be regarded as an accountable person if he satisfies the Revenue Commissioners in the manner specified in the regulations that he uses taxable goods in substantial quantities as materials.

• (4) The foregoing provisions of this section shall have effect subject to the proviso that where, in a case in which a seller would, apart from this subsection, be accountable for and liable to pay wholesale tax, the right to receive the whole or any part of the moneys payable in respect of the sales is or becomes vested in a person other than the seller, the person in whom such right is or becomes vested shall be accountable for and liable to pay wholesale tax on such moneys as he may receive in respect of the sales.

• (5)
• (a) Wholesale tax shall not be chargeable and a person shall not be accountable for wholesale tax on moneys received by him in relation to any exempted activity.

• (b) In the foregoing paragraph “exempted activity” means—

• (i) any activity which is an exempted activity within the meaning of section 48 (2) of the Finance Act, 1963,

• (ii) any activity which is declared by the Minister for Finance by order to be, for the purposes of this subsection, exempted, or

• (iii) sales of any of the following articles (subject to such definitions, if any, of those articles as may be specified by the Minister for Finance by order), that is to say, food, drink, tobacco, medicines, clothing, fuel or hydrocarbon oils.

4 Registration.

4.—(1) The Revenue Commissioners shall set up and maintain a register of persons who may become or who are accountable for wholesale tax and shall allot to every person so registered a registration number in addition to any such number allotted to that person under section 49 of the Finance Act, 1963, and shall cancel such number if the person does not become or ceases to be accountable for wholesale tax.

• (2) Every person who on the appointed day is carrying on an activity of selling goods in such circumstances that he would be an accountable person, or who, after the appointed day commences to carry on any such activity or becomes an accountable person, shall, within the period of nine days beginning on the appointed day or on the day thereafter on which he commences to carry on any such activity or becomes an accountable person, furnish in writing to the Revenue Commissioners the particulars specified in regulations as being required for the purpose of registering such person for wholesale tax.

• (3) In this section “the appointed day” means the day appointed by the Minister for Finance by order to be the appointed day for the purposes of this section.

5 Moneys received from registered persons.

5.—Wholesale tax shall not be charged on moneys received from a person registered as aforesaid for or in respect of goods sold to him.

6 Certain appropriations to be treated as sales.

6.—Where a person who in accordance with section 5 of this Act has purchased taxable goods in circumstances in which wholesale tax is not chargeable, or who in accordance with section 11 of this Act has imported taxable goods in circumstances in which wholesale tax is not chargeable, applies or appropriates any of those goods or any taxable goods made by him or which are the result of a process applied by him, otherwise than—

• (a) in the case of a manufacturer—as materials or as stock in trade, or

• (b) in any other case—as stock in trade,

he shall, for the purposes of this Act, be deemed thereby to have received payment in respect of a sale of the goods so applied or appropriated at the wholesale price current at the time of the application or appropriation.

7 Rate of wholesale tax.

7.—(1) Wholesale tax shall be five per cent. of the taxable turnover, as defined by this section, of the accountable person and the amount of tax chargeable during every month shall be paid after the expiration of the month in accordance with regulations.

• (2) In this section “taxable turnover” means the total amount of money received by the accountable person in respect of which he is accountable for and liable to pay wholesale tax.

• (3) Where the moneys received by an accountable person are derived in whole or part from selling taxable goods at current retail prices, the amount of wholesale tax shall, subject to regulations, be reduced to the amount which would be payable if those sales had been made at current wholesale prices.

8 Special provisions as to certain sales.

8.—Where it appears to the Revenue Commissioners that the moneys received by an accountable person in respect of the sale of any taxable goods are less than the moneys which would be received if the goods were sold in the open market, they may estimate what the taxable turnover would be if the goods were sold in the open market and the amount so estimated shall, subject to section 24 of the Finance Act, 1966, be the taxable turnover for the purposes of section 7 of this Act.

9 Additions to certain payments.

9.—Where the whole or part of the taxable turnover of an accountable person consists of moneys paid under a contract entered into before the 1st day of October, 1966, the accountable person may, in the absence of agreement to the contrary, recover as an addition to the payments specified in the contract a sum equal to any amount payable by him in respect of the moneys on account of wholesale tax.

10 Applications and amendments.

10.—(1) (a) The provisions (including penalty provisions) of—

• (i) Part VI of the Finance Act, 1963 (other than the excepted sections), Part VI of the Finance Act, 1965, and Part VI of the Finance Act, 1966, and

• (ii) regulations made before the passing of this Act,

shall, save where the context otherwise requires, apply to the wholesale tax as if that tax were turnover tax charged by virtue of Part VI of the Finance Act, 1963.

• (b) In the foregoing paragraph “the excepted sections” means sections 47, 48, 49, 50, 51, 53 and 64 of the Finance Act, 1963.

• (2) Section 52 of the Finance Act, 1963, is hereby amended by the insertion at the end of subsection (1) of the following paragraphs:

• “(o) the particulars to be furnished by a manufacturer who is not an accountable person in relation to wholesale tax in support of his application to be treated as such an accountable person and the conditions on which he may be so treated,

• (p) procedures for granting relief from wholesale tax in respect of taxable goods sold at current retail prices,

• (q) procedures in relation to wholesale tax whereby—

  • (i) a purchaser shall notify the seller that he is and continues to be a registered person, and

  • (ii) a seller shall verify that a purchaser is a registered person at the time of the sale.”

• (3) Subsections (2) and (5) of section 57 of the Finance Act, 1963, are each hereby amended by the insertion of “or subsection (2) of section 4 of the Finance (No. 2) Act, 1966,” after “subsection (3) of section 49 of this Act”.

• (4) Subsections (1) and (2) of section 39 of the Finance Act, 1965, are each hereby amended by the insertion of “or subsection (5) of section 3 of the Finance (No. 2) Act, 1966,” after “subsection (2) of section 48 of the Finance Act, 1963,”.

11 Charge of wholesale tax on imported goods.

11.—(1) Sections 3 to 10 of this Act shall not apply to wholesale tax provided for by section 2 (b) of this Act and that tax shall, subject to subsection (2) of this section, be charged on every article imported on or after the 1st day of October, 1966, at the rate of five per cent. of the value of the article.

• (2) Tax as aforesaid shall not be charged on any article which is declared by the Minister for Finance by order to be an article not chargeable with such tax as aforesaid on being imported into the State, or which is an article imported by a person registered under section 4 of this Act.

• (3) Subject to the foregoing provisions of this section, the provisions of the Customs Consolidation Act, 1876, and the enactments amending that Act and other enactments relating to Customs shall apply to tax referred to in this section as if it were a duty of customs.

• (4) The value of an article for the purpose of this section shall be the value as defined in section 15 of, and the Third Schedule to, the Finance Act, 1952, increased by the amount of any customs duty payable thereon.

12 Care and management of wholesale tax.

12.—Wholesale tax is hereby placed under the care and management of the Revenue Commissioners.

13 Short title and construction.

13.—(1) This Act may be cited as the Finance (No. 2) Act, 1966.

• (2) This Act shall be construed together with Part VI of the Finance Act, 1963, Part VI of the Finance Act, 1965, and Part VI of the Finance Act, 1966.