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Estonia plans to increase its standard VAT rate from 22% to 24% starting July 1, 2025, as part of broader tax reforms under discussion in Parliament, including income tax changes.
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Contracts signed before May 1, 2023, without VAT adjustment clauses, will be allowed to apply the old 20% VAT rate until June 30, 2025, after which the new 24% rate applies.
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Estonia’s Tax and Customs Board provided technical details on VAT returns effective July 1, 2025, to assist businesses in adapting their invoicing, accounting, and reporting systems to the new VAT rate.
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The final decision on the proposed tax law amendments, including the VAT increase, is expected by June 3, 2025, but changes to the VAT rate are highly likely given ongoing legislative progress.
Source: vatabout.com
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