One rate of VAT?

Does anyone know why we have two VAT rates?
Would it make more sense just to one common rate of say 15 or 16%?

We actually have 4 rates (ignoring zero rating & other EU issues ) :-

0% , 5.2% 13.5% and 21.5%, the goods and services at each are covered in Revenue's Guide to Value Added Tax.

The so-called "luxury goods" and certain professional services traditionally attracted the higher rates. A lot of staple foodstuffs attract 0% . Historically the reason may have been to relieve the basics/essentials and tax the luxury items. However over the years this has muddied quite a bit.

There was a situation many years ago where electrical items such as fridges attracted what was then the higher 35% rate but televisions attracted the lower 23% rate. Someone obviously believed that a TV was more of an essential than a fridge.

If you buy a sandwich and a cup of coffee to take away from a Mace Supermarket can they charge you 21% vat?

21.5% would not apply however depending on the way the sale is managed could be 0% or 13.5%. There are also rules on items supplied for an inclusive or meal deal price. The Revenue guide on this is here . Hot or cold can have a bearing on the rate of VAT chargeable. I do not see that a sandwich (hot or cold) and a coffee should be 21.5%. The most should be 13.5%.

A cold sandwich sold in a supermarket for take away would be 0%.
A coffee would be 13.5% ( as it is hot )
A cold sandwich and a coffee sold for an inclusive price would be 13.5% for the lot.
A cold sandwich and a milk would be both 0%
A hot breakfast roll and a tea would both be 13.5%
Ice cream sold as part of a meal in a restaurant would be 13.5% but sold to take away in a shop would be 21.5%.

The rate is 4.8% - not 5.2% for agricultural priduce and livestock

Under a European directive, we've committed to (basically) four different rates, and we're only allowed to move the rates within narrow ranges.

Domo said:

The rate is 4.8% - not 5.2% for agricultural priduce and livestock

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[broken link removed]
Suggests that it is 5.2%.

Hi,
The rate of VAT on Agri Produce and Livestock is 4.8%. The rate of 5.2% is the flat rate addition payable to unregistered farmers to compensate them for the VAT that they do not recover VAT.
A Flat rate farmer who sells an animal for €100 will get an extra €5.20 VAT which he is not obliged to pay over to the Collector General. A registered Farmer gets paid €104.80, €4.80 of which he has to pay over to the Collector General.

Joe_90 said:

Hi,
The rate of VAT on Agri Produce and Livestock is 4.8%. The rate of 5.2% is the flat rate addition payable to unregistered farmers to compensate them for the VAT that they do not recover VAT.
A Flat rate farmer who sells an animal for €100 will get an extra €5.20 VAT which he is not obliged to pay over to the Collector General. A registered Farmer gets paid €104.80, €4.80 of which he has to pay over to the Collector General.

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Thanks for clarifying that, my head was on one track not the other.