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Looking back @2021 #21: Global VAT rate changes, continuous monitoring needed

Highlights – Developments & trends in 2021

  • Numerous VAT rate changes happen worldwide, on a permanent or temporary basis to fight COVID-19 impact for both medical equipment and economy supporting measures
  • Few countries decreased VAT rates on electricty, gas, heating, etc to offset increase in energy prices
  • Bahrain will double its VAT rate from 5% to 10% as of Jan 1, 2022
  • Not any country in the European Union has an intention to change its standard VAT rate
  • The Ecofin has agreed to give the EU Member States more flexibility on determining the VAT rate of certain goods and services

Global VAT/GST Rate Changes as of December 1, 2021

www.vatupdate.com

Status December 21, 2021

See also

Note:

  • You can move from left to right in the below table by clicking the arrow in the mid of the page
  • More detailed on the VAT rate changes can be found by clicking on the name of the country

Global VAT rate changes as of December 1, 2021

 

VAT RATE CHANGES
Country Start date End date (if appplicable) Old rate New rate Scope
Algeria 31/12/2024 9% Extend 9% reduced VAT rate for specific goods and services
Angola 14% 7% Essential consumer goods
Aruba 01/01/2023 (?) 12,5% Introduction of VAT
Austria 31/12/2021 20% 5% Temporary application of a reduced VAT rate of 5% in the gastronomy, culture and publishing sectors shall be prolonged to last until 31 December 2021
Azerbaijan 01/01/2022 31/12/2022 0% Exempted sale, import of electric cars from VAT in 2022
Bahamas 01/01/2022 12% 10% VAT rate reduced from 12% to 10%, but less transactions subject to 0%

 

Bahrain 01/01/2022 5% 10% Approved – Standard rate
Belgium 01/01/2021 31/12/2022 6% Demolition and reconstruction of private residences
Belgium 31/12/2021 21% 6% Masks and hydroalcoholic gels
Belgium 21% 6% Reduced VAT rate for hair prostheses

 

Bulgaria 31/12/2021 20% 9% (1) Restaurant and catering services, which consist of supply of cooked and uncooked food, except for services, which consist of supply of spirits. (2) Supply of books on physical carriers or by electronic means (including textbooks, training aids, drawing books, etc.), but excluding editions with advertising content and editions where the content is mostly musical or audio-visual and (3) diapers for babies.
Bulgaria 01/01/2022 31/12/2023 9% DRAFT – Fruits and Vegetables

 

Cabo Verde 15% 8% Electricity and water
Cyprus 01/11/2021

01/11/2021

30/04/2022

31/01/2022

19%

19%

5%

9%

Electricity consumption in vulnerable households

Electricity consumption for other households

Czech Republic 01/11/2021 31/12/2021 0% Electricity and Gas
Czech Republic 16/08/2022 15% 10% VAT cut on accommodation, sporting & cultural events
Czech Republic 03/02/2021 31/12/2021 0% VAT exemption for respirators
European Union 31/12/2022 0% VAT Relief on Vaccines and Test Kits for EU hospitals, medical practitioners and individuals. This measure is applicable in all EU Member States
European Union PROPOSAL: VAT exemption for vital goods and services distributed by the EU in times of crisis

 

European Union 31/12/2021 0% Waiver of customs duties and VAT on the import of medical equipment from non-EU countries

 

France (New Caledonia) 01/01/2022

01/07/2022

01/07/2022

6%

11%

3%

11%

16%

5%

Local services

Standard rate on goods

Reduced rate of certain supplies

Germany 31/12/2022 19%  7% VAT cut for COVID restaurants; catering
Greece 30/06/2022 6% Reduced VAT Rate for PPEs/Covid-19 medical equipment (Extended till June 30, 2022)
Greece 30/06/2022 6% Reduced VAT rate for agricultural goods, industrial food and provision of services by gyms and dance institutions, the coffee served, non-alcoholic beverages, transport, movie tickets and the tourist package and food
Greece 30/06/2022 13% Entrance tickets for zoos
Hungary 01/01/2021 31/12/2022 27% 5% Reduced VAT Rate for New Residential Properties
Hungary 01/01/2022 5% Specific food products
Indonesia 01/04/2022

01/01/2025

31/12/2024 10%

11%

11%

12%

DRAFT – Standard rate
Ireland 31/08/2022 13.5% 9% Temporary VAT cut on tourism and hospitality for COVID
Ireland 01/09/2022 9% VAT rate of 9% for hairdressers extended until September 2022
Italy Proposal budget 2022 22% 10% Feminine hygiene products

 

Italy 31/12/2021 5% Natural Gas supplies
Latvia 01/01/2022 5% Electronic publications
Lithuania 01/07/2021 31/12/2021 21% 9% Hospitality, sporting and cultural services
Lithuania 01/05/2022 5% Proposal: 5% VAT for thermal energy and natural gas to consumers
Mexico 01/01/2021 31/12/2024 16% 8% VAT at Southern and Northern border regions
Moldova 15/01/2022 12% 6% Hotel and Restaurant Services
Netherlands Not known yet 9% Online sports services by gyms
North Macedonia 16/07/2021

01/07/2022

30/06/2022

30/06/2023

 

5%

5%

10%

Electricity Supplies

 

Norway 01/07/2022 0% Exemption from VAT for naprapaths and osteopaths

 

Paraguay 31/12/2021 Tourism, catering and accommodation. Taxpayers must apply the 10% VAT rate to 50% of the service price.

 

Poland End of pandemic 0% Import of goods purchased for the purpose of combating COVID-19
Poland 01/01/2022 30/06/2022 0% Proposal – Natural gas, electricity and heat

 

Portugal 31/12/2021 6% Reduced rate on face masks and hand sanitizer sold to general public
Romania 01/01/2022 5% Reduced VAT rate on e-books, audio books, blogs, electronic newspaper and journal
Romania 01/12/2021 5% Reduced VAT rate for firewood for heating the population
Romania 01/01/2022 31/12/2022 19% 5% Proposal – Domestic heating energy
Spain 26/06/2021 21% 10% Electricity supplies
Spain 30/06/2022 4% Surgical masks
Sri Lanka 01/01/2022 31/12/2022 15% 18% Increase in VAT rate on financial services from 15% to 18% during 2022
Suriname 01/20/2021 8%/10% 12% Increase in the sales tax rate to a single rate
Suriname 31/12/2023 0% Basic Food
Sweden 01/07/2022 12% 6% DRAFT – Repairs to bicycles, shoes, clothing, etc
Thailand 01/09/2023 7% 10%
Turkey  01/20/2021 18% 1% Reduced VAT Rate for Used Mobile Phones
United Arab Emirates 01/09/2020 31/12/2021 5% 0% Temporary zero-rating of personal protective equipment (PPE)
UK 01/10/2021 31/03/2022 5% 12.5% Temporary VAT cut on tourism and hospitality for COVID
Uruguay 30/04/2022 9% Certain activities/operations in relation to tourism, including restaurant services, car rentals, and leasing of real estate for tourist purpose
Uzbekistan 01/01/2023 15% 12% DRAFT – Standard rate
Uzbekistan 31/12/2021 0% Meat and poultry
Vietnam

 

01/11/2021 31/12/2021 VAT reduced by 30 percent

 


 


Check also the previous articles on ”Looking back @2021”

  1. Brexit
  2. E-Commerce VAT Directive launched in the EU per July 1, 2021
  3. Next to the EU, 14 countries implemented VAT on E-Commerce, another 7 will implement in 2022
  4. Saudi-Arabia is the first country in the Middle East launching E-Invoicing, UAE may follow
  5. The concept of Fixed Establishments remains a major risk, and even why?
  6. Intrastat: Major updates applicable as of Jan 1, 2022
  7. Implementation/changes E-Invoicing & Real Time Reporting during 2021
  8. ECJ cases decided in 2021 on ”Taxable Amount”
  9. Increased focus on Fighting Climate Change – Carbon tax

  10. 49 ECJ VAT Cases decided (incl. orders) in 2021
  11. Split Payments
  12. Poland and France to introduce optional taxation of Financial Services – Exemption may not longer be applied
  13. Activities of the VAT Expert Group
  14. ECJ cases decided in 2021 on ”Exemptions”
  15. Pre-Filled VAT returns
  16. SAF-T (or equivalent) regulations, some more countries will implement
  17. Environmental Tax – Will Plastic Tax stop pollution?
  18. VAT Grouping, a tool to avoid VAT leakage, optimize VAT receivables and simplify processes 
  19. EU VAT Committee met twice and a proposal to transform it into comitology committee was discussed
  20. ECJ cases decided in 2021 on ”Right to deduct VAT/Refund of VAT”

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