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12 VAT rate changes announced in July 2021

It can be hard for any tax team to stay on top of the latest rate changes, which is why we’ve compiled 12 of the most important updates this month into a handy overview.

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1) Portugal

The autonomous region of Azores has reduced its standard VAT rate to 16%, down from 18%.

2) Belgium

A reduced rate of VAT of 6% for hydroalcoholic gels and masks will continue in Belgium until at least 30th September 2021.

3) Norway

Reports suggest the Norwegian government has approved an extension of the country’s reduced VAT rate that was initially implemented in response to the Covid-19 pandemic. The reduced rate will continue to apply to transport, overnight accommodation, cinemas, museums and sporting events.

4) Philippines

A proposed new 12% VAT rate on exporters in the Philippines has been deferred. Once implemented, the tax will apply to sales of raw materials and packaging items to non-resident buyers for delivery to a resident.

5) Greece

A permanent reduction in the VAT rate for five Greek islands has been confirmed. Kos, Lesbos, Somos, Chios and Leros are now subject to a 30% decrease in VAT that was introduced on 1st July.

6) Netherlands

Sperm from sport horses will be taxed at 9% if it is intended for the reproduction of animals intended for the production of food or for agricultural use. The state secretary has ruled that sport horses used for breeding may also be regarded as breeding horses and therefore the tax applies.

7) Lithuania

Lithuania’s parliament has approved a temporary extension of its 9% VAT rate for the catering, culture and sports industries.

8) Spain

The VAT rate on electricity supplies in Spain has been reduced from 21% to 10% until 31st December 2021, subject to certain conditions being met.

9) UK

The UK’s reduced rate for the hospitality and tourism sectors stands at 5% until 30th September 2021. It has now been confirmed that businesses in these industries will now benefit from a transitional rate of 12.5% from 1st October 2021 until 31st March 2022.

10) Romania

A new reduced rate of 5% will apply for the sale of books, manuals, newspapers and magazines in electronic format from 2022.

11) Thailand

The VAT rate in Thailand will return to 10% from 1st October 2021 unless a further extension to the current lower rate is granted.

12) Colombia

Medical equipment, soap, antibacterial gel, cleaning products, laundry detergent and other sanitary products will continue to be zero-rated until at least 31st August 2021.