Estonia
From 1 July 2025, Estonia will increase its standard VAT rate from 22% to 24%.
The reduced VAT rates will also increase from 9% to 13% and from 5% to 9%.
Germany
The German government has confirmed the reinstatement of the 7% reduced VAT rate for food sales by hospitality businesses, from 1 January 2026.
This VAT rate reduction was put in place from 2020 up until 1 January 2024 as a COVID-relief to help restaurants and cafes during the pandemic
Italy
The Italian Revenue recently published specific information regarding non-EU companies engaging in intra-EU trade of goods to and from Italy.
Businesses involved in intra-EU activities, including the movement, purchase and sale of taxable goods are required to register in the VAT Information Exchange System (VIES). This system is a database of all EU VAT numbers that are authorised to undertake intra-EU activities and enables users to obtain rapid confirmation of companies’ VAT numbers. It also allows EU VAT authorities to monitor and control the flow of intra-Community trade to detect irregularities and VAT fraud.
The information released confirms that non-EU entities performing intra-EU transactions will have to issue a financial guarantee of €50,000 to the Italian tax authorities to register for the VIES. This guarantee needs to be issued to the tax authorities from the affected companies bank or insurance company and must include the exact text per the tax authorities’ request. It must also be valid for at least 36 months.
Companies already VAT registered will have to provide a guarantee to the Italian tax authorities by 13 June 2025. The tax authorities also confirmed that non-compliance with the new regulations will result in the automatic closure of VAT numbers or cancellation of VIES registration.
Lithuania
The Lithuanian Ministry of Finance is proposing to:
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Increase the existing 9% reduced rate to 12% on supplies of some domestic passenger transport, domestic heating, tourist services, catering services and hotel accommodation.
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Decrease the existing 9% reduced rate to 5% on books and other non-periodical publications.
These proposals aim to support increased defense spending following the Russian invasion of Ukraine. The proposals were subject to public consultation until 30 April 2025.
The above news was kindly provided by Fiscal Solutions (UK), www.fiscalsolutions.co.uk; contact: [email protected].
