European Commission propose new rules to give Member States more flexibility to set VAT Rates

31 January 2018

During January 2018, the European Commission proposed new rules to give Member States more flexibility to set their own VAT rates.

Currently member states are limited on what goods and services they can apply a reduced rate of VAT to, however if agreed these new proposals will allow member states to set reduced rates at 5% or zero on a broader range of goods and services.

If agreed, these new rules will likely be introduced during 2022 and would allow member states to implement:

  • Two separate reduced rates of between 5%, and the standard rate chosen by the Member States
  • One exemption from VAT (or ‘zero rate’); and
  • One super reduced rate set at between 0% and the reduced rates chosen by the Member State.


The press release of the Commission on the proposal can be found here while an informative Q&A sheet can be found here.

LATEST NEWS

EU VAT reclaim deadline extensions - 13th Directive

Many European Union (EU) member states have extended the deadline for non-EU companies to reclaim VAT incurred during 2019, from 30 June 2020 to 30 September...

SEE MORE
LATEST NEWS

REMINDER: Norway proposes the introduction of a...

From 1 April 2020, the Norwegian government has introduced changes to the Value Added Tax (VAT) rules that apply to non-resident businesses selling and...

SEE MORE
LATEST NEWS

Russia to cut VAT rates

The Russian government recently proposed that it will gradually reduce its Value Added Tax (VAT) rate from 20% to: 18% from 2021; 15% from 2023; and 12%...

SEE MORE

Gated Content

The following email providers are not accepted: gmail, hotmail, yahoo. Please use proper company email.