The Council of the European Union has reached an agreement on a proposal to update the rules for VAT rates for goods and services that offers member states more flexibility and equality supporting the EU’s green, digital and public health priorities. The Council of the EU awaits the European Parliament’s opinion on the proposal to formerly adopt the new directive by March 2022.
The proposals include:
changing the list of goods and services for which reduced VAT is allowed;
removing VAT exemptions for environmentally harmful goods while allowing reduced rates for environmentally friendly goods;
removing member state derogations for VAT reduction unless justified by public policy objectives other than those in support of EU's climate action; and
adding a new provision to address possible future crises such as pandemics, natural disasters and humanitarian crises’.
The Council of the European Union has reached an agreement on a proposal to update the rules for VAT rates for goods and services that offers member states more flexibility and equality supporting the EU’s green, digital and public health priorities. The Council of the EU awaits the European Parliament’s opinion on the proposal to formerly adopt the new directive by March 2022.
The proposals include:
changing the list of goods and services for which reduced VAT is allowed;
removing VAT exemptions for environmentally harmful goods while allowing reduced rates for environmentally friendly goods;
removing member state derogations for VAT reduction unless justified by public policy objectives other than those in support of EU's climate action; and
adding a new provision to address possible future crises such as pandemics, natural disasters and humanitarian crises’.
