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Image header Agence Europe
Europe Daily Bulletin No. 9895
Contents Publication in full By article 16 / 36
GENERAL NEWS / (eu) eu/taxation

Agreement on reduced VAT rates carved in stone

Brussels, 05/05/2009 (Agence Europe) - On Tuesday 5 May without debate, European finance ministers endorsed two legislative acts in the field of value added tax (VAT), which transcribe the political agreement on reduced VAT rates reached early March into the European body of law (see EUROPE 9858). A first directive will amend the VAT directive (2006/112/EC) to authorise member states that so wish to permanently apply reduced taxation to certain high labour-intensive activities (e.g. small bicycle repairs, window cleaning, personal care, renovation of private housing). Catering and the sale of “books on all physical means of support” (Ed.: this includes “e-books”, the physical support being a computer) are added to this list. Some countries benefit from specific provisions: - Cyprus will apply reduced indirect taxation to the distribution of LPG gas bottles, and the same is true for Portugal for toll bridges over the Tage; - and Malta will maintain a zero rate for provision of foodstuffs and pharmaceutical products. Furthermore, the United Kingdom will continue to apply, until end April 2011, the VAT voluntary liquidation mechanism for deliveries of portable phones worth £5,000 sterling. (M.B./transl.jl)

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