Estonia
Estonia’s government has announced that from 1 July 2025, it will increase the standard VAT rate from 22% to 24%.
This increase will also see the reduced VAT rates increase from 9% to 13% and from 5% to 9%. The plan is to raise funds to allow the government to acquire long-range weapon systems and munitions.
Finland
The Finnish government has confirmed that its’ standard VAT rate will increase from 24% to 25.5% from 1 September 2024. This increase will make the Finnish standard VAT rate the second highest in the EU with only Hungary’s VAT rate being higher, at 27%.
There will be no change to the 14% and 10% reduced VAT rates
Luxembourg
Luxembourg confirmed that from 1 January 2025, it will reduce the VAT rate on works of art from 17% to 8%.
Luxembourg joins many other EU member states who have already applied the reduced VAT rate on the sale of artwork, including Germany (7%), France (5.5%), and Belgium (6%).
Slovenia
The Slovenian government is proposing to introduce a mandatory electronic invoicing regime for business to business (B2B) transactions, from 1 January 2026. The draft legislation will now be provided to the national assembly in Slovenia for review and approval.
Currently, Slovenia allows all invoices to be issued in paper format however if the new regime is accepted, all VAT-registered companies will be required to issue electronic invoices when selling to other businesses. This will include non-resident VAT registered companies
Spain
The Spanish government’s plan to introduce a mandatory e-invoicing regime from July 2025 for Spanish resident businesses has been set back and will likely be introduced from 1 January 2026.
Currently, the Spanish tax authority receives transactional information from certain taxpayers through the Suministro Inmediato de Información (SII). However, this platform only applies to large enterprises with an annual turnover of over €6 million, and companies affected are only required to upload invoices to the tax authorities within four working days from the issue or receipt of an invoice.
By moving to compulsory e-invoicing over SII, it will mean a wider set of taxpayers will be required to validate their B2B invoices on a speedier basis before issuing these to their clients. It is hoped that this will then prevent common errors on these types of invoices and will help prevent VAT fraud in the country.
Switzerland
Switzerland’s Federal Tax Administration launched a public consultation on its’ plan to impose deemed supplier rules from 1 January 2025 on digital platforms (such as Amazon) to charge, collect and remit VAT on sales of low value imported goods by non-resident suppliers to consumers in the country.
Current rules allow low-value consignments with a value of up to CHF 65 (approx. £57) to be imported and cleared VAT-free. However, any seller that exceeds CHF 100,000 (approx. £88,000) in sales of low-value goods must VAT register and charge VAT on sales in the country. This leaves the current process susceptible to VAT fraud as many non-resident companies are ignoring these requirements.
It is hoped that the introduction of these rules will help to level the playing field as it will guarantee that VAT will be collected on the sale of low-value goods via online platforms.
Switzerland has confirmed that the deemed supplier regime will not be extended to the sales of digital services
The above news was kindly provided by Fiscal Solutions (UK), www.fiscalsolutions.co.uk; contact: [email protected].
