VAT Rates in the EU and Neighboring European Countries
1. Standard VAT Rates Across Europe
1.1 European Union
The EU operates under a harmonized VAT system with minimum standard rate requirements:
- Standard rate minimum: 15% (most countries have higher rates)
- Reduced rates: Member states can apply up to two reduced rates (minimum 5%) to specific goods/services
- Super-reduced rates: Some countries maintain special rates below 5% for specific items
| EU Member State |
Standard Rate (%) |
Reduced Rates (%) |
| Austria |
20 |
10, 13 |
| Belgium |
21 |
6, 12 |
| Bulgaria |
20 |
9 |
| Croatia |
25 |
5, 13 |
| Cyprus |
19 |
5, 9 |
| Czech Republic |
21 |
10, 15 |
| Denmark |
25 |
- |
| Estonia |
22 |
9 |
| Finland |
24 |
10, 14 |
| France |
20 |
5.5, 10 (2.1 super-reduced) |
| Germany |
19 |
7 |
| Greece |
24 |
6, 13 |
| Hungary |
27 |
5, 18 |
| Ireland |
23 |
9, 13.5 (4.8 super-reduced) |
| Italy |
22 |
5, 10 (4 super-reduced) |
| Latvia |
21 |
5, 12 |
| Lithuania |
21 |
5, 9 |
| Luxembourg |
17 |
8, 14 (3 super-reduced) |
| Malta |
18 |
5, 7 |
| Netherlands |
21 |
9 |
| Poland |
23 |
5, 8 |
| Portugal |
23 |
6, 13 |
| Romania |
19 |
5, 9 |
| Slovakia |
20 |
10 |
| Slovenia |
22 |
5, 9.5 |
| Spain |
21 |
10 (4 super-reduced) |
| Sweden |
25 |
6, 12 |
1.2 Non-EU European Countries
| Country |
Standard Rate (%) |
Reduced Rates (%) |
| United Kingdom |
20 |
5 (0 zero-rated) |
| Norway |
25 |
12, 15 |
| Switzerland |
7.7 |
2.5, 3.7 |
| Iceland |
24 |
11 |
| Albania |
20 |
6 |
| Serbia |
20 |
10 |
| Turkey |
20 |
1, 8, 10 |
2. Reduced and Special VAT Rates
2.1 Common Reduced Rate Categories
| Category |
Typical Rate Type |
Common Examples |
| Food and agricultural products |
Reduced or Super-reduced |
Basic foodstuffs, agricultural inputs |
| Books, newspapers, and cultural events |
Reduced |
Books, newspapers, museum entrance |
| Hotels and restaurants |
Reduced or Intermediate |
Accommodation, food service |
| Medical supplies and equipment |
Reduced or Zero-rated |
Pharmaceuticals, medical devices |
| Home renovations and repairs |
Reduced |
Labor for residential renovations |
| Passenger transport |
Reduced |
Public transport, taxi services |
2.2 Country-Specific Examples
Some notable examples of how countries structure their multiple VAT rates:
- France: 20% standard, 10% intermediate, 5.5% reduced, 2.1% super-reduced
- Germany: 19% standard, 7% reduced
- Italy: 22% standard, 10% intermediate, 5% reduced, 4% super-reduced
- UK: 20% standard, 5% reduced, 0% zero-rated (different from exempt)
3. Business VAT Requirements
3.1 VAT Registration
- Mandatory registration thresholds vary by country
- EU businesses trading across borders need either:
- Local VAT registration in each country where they exceed thresholds
- Registration for the One-Stop Shop (OSS) system for B2C sales
| Country |
VAT Registration Threshold |
Notes |
| United Kingdom |
£85,000 (approx. €100,000) |
Annual turnover |
| Ireland |
€35,000 (services), €75,000 (goods) |
Separate thresholds |
| France |
€85,800 (goods), €34,400 (services) |
Separate thresholds |
| Germany |
€22,000 |
Annual turnover |
| Italy |
No threshold |
Registration required for any business activity |
| Spain |
No threshold |
Registration required for any business activity |
| Netherlands |
No threshold |
Small business exemption available |
3.2 VAT Compliance for Businesses
- Filing frequency varies (monthly, quarterly, annually)
- Digital filing is mandatory in most countries
- Record keeping requirements (typically 5-10 years)
- Input VAT recovery process for business expenses
- Special schemes for small businesses in many countries
3.3 Cross-Border Business Transactions
| Transaction Type |
VAT Treatment |
Reporting Requirements |
| Intra-EU B2B |
Reverse charge mechanism (recipient accounts for VAT) |
EC Sales List (ESL), Intrastat (if above threshold) |
| EU B2C Distance Sales |
Supplier charges VAT of customer's country |
OSS return (or local registration) |
| EU to Non-EU Export |
Zero-rated in EU, import VAT in destination |
Export declaration, proof of export |
| Non-EU to EU Import |
Import VAT at customs |
Import declaration, potential IOSS for B2C |
Note: New €10,000 pan-EU threshold under OSS applies to distance selling within the EU. Below this threshold, home country VAT can be charged.
4. VAT for Travelers and Tourists
4.1 VAT Refund Eligibility
- Available to non-EU residents (including UK citizens since Brexit)
- Purchases must exceed minimum amount (varies by country)
- Goods must be exported unused within 3 months
- Original receipts and export validation required
| Country |
Minimum Purchase for Refund |
Refund Rate |
| France |
€100 |
12-15.5% (service fees apply) |
| Italy |
€154.94 |
11-14% (service fees apply) |
| Germany |
€50 |
13-14.5% (service fees apply) |
| Spain |
€90.16 |
10.5-13.5% (service fees apply) |
| United Kingdom |
£30 in a single store |
10-14% (service fees apply) |
4.2 Refund Process
- In-store: Complete tax-free form at retailer
- At departure: Get customs validation stamp before checking luggage
- Collection options:
- Immediate cash refund at airport (service fee applies)
- Credit card refund (2-6 weeks processing)
- Digital refund services (Global Blue, Planet, etc.)
4.3 Notable Exceptions
- Services (hotels, restaurants) generally not eligible for refunds
- UK has different post-Brexit refund system than EU countries
- Some luxury items may have special rules or restrictions
5. Special VAT Considerations
5.1 Digital Services
- EU: VAT charged based on customer location
- One-Stop Shop (OSS) simplifies compliance for digital service providers
- B2C digital services always taxed at destination rate
5.2 Brexit Impact on UK-EU Trade
| Aspect |
Pre-Brexit |
Post-Brexit |
| B2B Goods |
Intra-EU rules (zero-rated) |
Export/Import procedures |
| B2C Goods |
Distance selling thresholds |
Import VAT due on all shipments |
| Services |
Place of supply rules |
Similar rules but outside EU VAT area |
| VAT Recovery |
Via EU VAT refund system |
Via 13th Directive (paper claims) |
UK businesses selling to EU consumers must register for EU VAT or use OSS
Import VAT now applies to goods moving between UK and EU
Postponed VAT accounting system implemented in the UK
5.3 VAT Exemptions
Common categories across Europe:
- Healthcare and medical services
- Educational services
- Financial and insurance services
- Real estate transactions (with exceptions)
- Postal services
- Charitable activities
6. Recent VAT Developments
6.1 COVID-19 Temporary Measures
- Reduced rates for hospitality, restaurants, and PPE in many countries
- Extended filing deadlines and payment deferrals
- Some measures made permanent, others phased out
6.2 E-commerce VAT Changes (July 2021)
- Removal of €22 import VAT exemption
- Introduction of Import One-Stop Shop (IOSS)
- Marketplace liability for facilitating certain sales
| E-commerce Change |
Impact |
| IOSS Introduction |
Simplifies VAT collection on imports under €150 |
| Removal of Low-Value Exemption |
All imports now subject to VAT regardless of value |
| Marketplace Deemed Supplier |
Online marketplaces responsible for VAT on facilitated sales |
| One-Stop Shop Extension |
Single return for all EU B2C supplies |
6.3 Green VAT Initiatives
- Reduced rates for environmentally friendly products
- Electric vehicle charging incentives
- Energy-efficient building materials
7. VAT Calculation Tools
A comprehensive VAT calculator should include:
- Country-specific rates (standard and reduced)
- Toggle between inclusive/exclusive calculations
- Cross-border transaction options
- Threshold warnings for registration requirements
- Recent rate changes and upcoming changes
Disclaimer: VAT rates and regulations are subject to change. This information is provided for general guidance only and should not be relied upon as a substitute for professional tax advice. Always consult with a qualified tax professional for specific situations.