VAT: reduction on EU goods & services
19 February 2009
Today Parliament voted a plan to widen the scope for
Member States to apply reduced VAT rates to certain services,
including restaurants, audio books, beauty treatment, children's
car seats, etc. but it won't apply to alcoholic drinks.
Vote results: 636 votes in favour, 14 against and 18
abstentions.
Background:
VAT rate rules are fairly simple. Goods and services
subject to VAT are normally subject to a rate of at least 15%.
Member States can then apply reduced rates to some listed goods and
services, provided they are not inferior to 5%. However, there are
many possible derogations and many complex rules.
NOTA BENE: On 1st Dec 09 and for a
duration of 13 months, the UK introduced a VAT cut from 17.5% to
15% !
As usual, Parliament's views for taxation issues are not
binding. So, the final decision is for the Council, acting
unanimously.
Want to read the adopted text?
http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+TA+P6-TA-2009-0072+0+DOC+XML+V0//EN&language=EN
