VAT in Europe

VAT rates are different in each European country. Businesses operating in multiple jurisdictions must ensure that they charge and get charged the correct VAT rate to avoid penalties or long VAT refund mechanisms.

The VAT rates in the European Union are generally harmonized based on the EU VAT Directive, however, each Member State has some margin to define its own Fiscal Policy. They must only comply with the following two basic rules:

rule 1

To establish a standard VAT rate for all goods and services

rule 2

To introduce one of several reduced VAT rates for the supplies of certain goods and services specified in the VAT Directive.

The EU establishes the following considerations to the EU VAT rates policy

Standard VAT rate must not be below the 15%; there is no maximum VAT rate limit.

Member States may only introduce two different reduced VAT rates, which cannot be under 5%. Only specific goods and services included on the Annex III of the EU VAT Directive can be subject to reduced VAT rate.

Nevertheless, due to EU VAT Directive modification, Member States may introduce lower reduced VAT rates and 0% VAT rates for the Annex III products and services.

Finally, the list of goods and services from Annex III has been extended to include, among others, the sale of solar panels, electric supplies, and the sale of bicycles.

The following overview is non-exhaustive and must be checked with our tax professionals before implementing this information into your system.

VAT rates in Europe

Country

Standard VAT Rates

Reduced VAT Rates

Standard VAT Rates:

20%

Reduced VAT Rates:

0% and EU Exemption, 10%, 13%, 19%

Standard VAT Rates:

21%

Reduced VAT Rates:

0% and EU Exemption, 6%, 12%

Standard VAT Rates:

20%

Reduced VAT Rates:

0%, 9%

Standard VAT Rates:

25%

Reduced VAT Rates:

0% and EU Exemption, 5%, 13%

Standard VAT Rates:

19%

Reduced VAT Rates:

0% and EU Exemption, 3%, 5%, 9%

Standard VAT Rates:

21%

Reduced VAT Rates:

0% and EU Exemption and 12%

Standard VAT Rates:

25%

Reduced VAT Rates:

0% and EU Exemption

Standard VAT Rates:

Reduced VAT Rates:

Standard VAT Rates:

24%

Reduced VAT Rates:

0%, 9%, 5%

Standard VAT Rates:

25.5%

Reduced VAT Rates:

0% and EU Exemption, 10%, 13.5%

Standard VAT Rates:

20%

Reduced VAT Rates:

0% and EU Exemption, 2.1%, 5.5%, 10%

Standard VAT Rates:

19%

Reduced VAT Rates:

0% and EU Exemption, 7%

Standard VAT Rates:

24%

Reduced VAT Rates:

0% and EU Exemption, 6%, 13%

Standard VAT Rates:

27%

Reduced VAT Rates:

0% and EU Exemption, 5%, 18%

Standard VAT Rates:

Reduced VAT Rates:

Standard VAT Rates:

23%

Reduced VAT Rates:

0% and EU Exemption, 4.8%, 9%, 13.5%

Standard VAT Rates:

22%

Reduced VAT Rates:

0% and EU Exemption, 4%, 5%, 10%

Standard VAT Rates:

21%

Reduced VAT Rates:

0% and EU Exemption, 5%, 12%

Standard VAT Rates:

21%

Reduced VAT Rates:

0% and EU Exemption, 5%, 9%

Standard VAT Rates:

17%

Reduced VAT Rates:

0% and EU Exemption, 3%, 8%, 14%

Standard VAT Rates:

18%

Reduced VAT Rates:

0% and EU Exemption, 5%, 7%, 12%

Standard VAT Rates:

21%

Reduced VAT Rates:

0% and EU Exemption, 9%

Standard VAT Rates:

Reduced VAT Rates:

Standard VAT Rates:

23%

Reduced VAT Rates:

0% and EU Exemption, 5%, 8%

Standard VAT Rates:

23% - In Azores: 16% - In Madeira: 22%

Reduced VAT Rates:

0% and EU Exemption, 6%, 13% - In Azores: 4%, 9% - In Madeira: 4%,12%

Standard VAT Rates:

21%

Reduced VAT Rates:

0% and EU Exemption, 11%

Standard VAT Rates:

Reduced VAT Rates:

Standard VAT Rates:

23%

Reduced VAT Rates:

0% and EU Exemption, 5%, 19%

Standard VAT Rates:

22%

Reduced VAT Rates:

0% and EU Exemption, 5%, 9.5%

Standard VAT Rates:

21%

Reduced VAT Rates:

0% and EU Exemption, 4%, 10%

Standard VAT Rates:

25%

Reduced VAT Rates:

0% and EU Exemption, 6%, 12%

Standard VAT Rates:

Reduced VAT Rates:

Standard VAT Rates:

20%

Reduced VAT Rates:

0%, 5%

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