Racing-mad Ireland taken to EU court over horse VAT rates

(BRUSSELS) - Racing-mad Ireland, one of the world's top breeders, is being taken to court by the European Commission over Dublin's application of a reduced VAT rate on horses and greyhounds.

The European Union's executive arm on Wednesday "decided to refer Ireland to the EU's Court of Justice over its application of a 4.8-percent reduced VAT rate for supplies of horses and greyhounds," it said.

The guardian of the world's biggest open trading bloc reaching half a billion consumers, Brussels argues that the reduced rate "could cause a distortion of competition within the EU."

The decision to go to court comes after Dublin, caught in the throes of a financial and government meltdown with low corporation tax levels one of the sticking points in talks over an international bailout worth some 85 billion euros, ignored a June warning.

The commission's action was among a lengthy list of new infringement proceedings announced against various states in the 27-nation bloc.

EU VAT Directive