Value added tax (VAT)

  • Introduction of a 0% VAT rate for basic products such as vegetables and fruit, medicines, diapers and other hygiene products, as well as public transport
  • Adjustment of the tariff structure in the sense that the existing reduced VAT rates of 6% and 12% will be harmonized into a new reduced VAT rate of 9%.
  • VAT rate on coal would be increased from 12% to 21%
  • Temporary reduced VAT rate for demolition and reconstruction would become permanent, although the new reduced VAT rate of 9% would apply instead of the existing 6% VAT rate
  • Further reduction of the VAT gap and on administrative simplification through digital and automated solutions such as e-invoicing and e-reporting

Excise duties

  • The reduced excise duties for fossil fuels will be phased out and the various exemptions for the specific use of fossil fuels (e.g., kerosene, heavy fuel oil, gas oil coal, coke and lignite) will be reformed
  • The excise duties on tobacco as well as on new and alternative tobacco products will be further increased

Source KPMG