An agreement has been reached within the Council of Ministers on the extension of the 6% tariff for demolition and reconstruction. We summarize the main elements of this agreement below, subject to possible adjustments during the legislative process.
First of all, the measure will apply from 1 January 2021 to 31 December 2022, whereby the application of the VAT rate will be determined in accordance with the due and payable rules. The following transitional arrangements are provided:
- For works relating to ongoing demolition / reconstruction projects where VAT has already become due before January 1, 2021, the reduced rate of 6% can still be applied to invoices between January 1, 2021 and December 31, 2022, provided that a prior declaration is submitted by March 31 at the latest. 2021;
- To avoid major shifts in invoicing for new demolition / reconstruction projects in 2022, the benefit of the 6% rate will be limited to 25% of the total amount if the application for the environmental permit is submitted from 1 July 2022.
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