Around 100,000 consumers who connected to a telephone or broadband service this year may have been overcharged for VAT and could be entitled to a rebate.
The Irish Times confirmed yesterday that Eircom and Esat BT are still levying 21 per cent VAT for network connections despite a Supreme Court ruling which found a lower rate should apply.
The landmark judgment in December 2003 found that cable firm NTL should be allowed to levy 13.5 per cent VAT on connection charges because it is a service rather than a product.
The case was expected to lead to a fall in the VAT rates levied by telecom companies on behalf of the Revenue Commissioners. However nine months after the landmark court case the two biggest telecom firms are still levying 21 per cent VAT on consumers.
Eircom said last night it was still in discussions with the Revenue Commissioners about the VAT rate that it charges for connections. It said it was unclear if the NTL VAT ruling automatically applied to it.
However, Mr David McRedmond, Eircom's commercial director, said Eircom would consider paying a refund to customers for connections if the Revenue Commissioners gave Eircom a rebate for the period since the court ruling.
A Revenue Commissioners spokesman would not comment on the case. However, he said if it was found that consumers had paid too much VAT there were mechanisms to provide tax rebates.
Over the past year 67,000 new customers have been connected to the Eircom telephone network. A further 73,000 people have signed up for its new broadband internet service, although some of these users got a free connection.