Croatia
Croatia have become the latest EU country to confirm they will introduce a mandatory electronic invoicing regime for B2B transactions, from 1 January 2027.
This new regime will apply to resident businesses selling to other VAT-registered businesses within Croatia and once introduced it will mean effected businesses will report their sales to the Croatian tax authorities via a new e-invoicing platform rather than sending invoices directly to their customers.
The goal of this invoice-reporting regime is to combat VAT fraud by providing tax authorities with real-time visibility into when VAT is charged and collected.
Finland
During June 2025, the Finnish government launched a public consultation on a proposal to reduce its reduced VAT rate from 14% to 13.5%.
If agreed this would be introduced from 1 January 2026 and would affect supplies such as food, accommodation and passenger transport.
Gibraltar
As a result of a post-Brexit agreement between the UK and Spain, the British overseas territory of Gibraltar will introduce a 15% sales tax by 2028.
Post Brexit, Gibraltar (which shares a land border with Spain) found itself outside the EU customs Union. This led to customs checks being implemented when goods and people cross the land border between the two countries.
To remove these custom checks and to allow for frictionless movement of people and goods, the European Commission insisted that the British territory aligns its taxation policies with the EU. The introduction of the sales tax at 15% will mark the end of Gibraltar’s long-standing VAT-free regime.
Italy
During June the Italian Council of Ministers agreed to cut VAT on the sales of art, antiques and collectors’ items from the standard VAT rate of 22% to the reduced VAT rate of 5%.
It is expected that this VAT rate cut will be implemented from 1 July 2025.
Latvia
The Latvian parliament (Saeima) confirmed that the introduction of mandatory e-invoicing for domestic B2B transactions will be delayed from January 2026 to January 2028.
This new regime will apply to resident companies selling to other VAT-registered businesses within Latvia and once introduced it will mean effected businesses will report their sales to the Latvian tax authorities via a new e-invoicing platform as well as send these directly to their customers.
The goal of this invoice-reporting regime is to combat VAT fraud by providing tax authorities with real-time visibility into when VAT is charged and collected.
Lithuania
The Lithuanian Ministry of Finance confirmed that it will:
-
Increase the reduced VAT rate of 9% to 12% affecting such services as domestic passenger transport, domestic heating, tourist services, catering and hotel accommodation.
-
Decrease the VAT rate applicable to books and non-periodical publications from 9% to 5%.
These changes will be implemented from 1 January 2026.
Romania
Romania confirmed that from 1 August 2025 most supplies carrying the reduced VAT rates of 5% and 9%, will be subject to the standard VAT rate of 19%. The only exception to this increase will be supplies of basic foods, medicines, fuel, energy and books.
It is hoped this will prevent a possible increase to the standard VAT rate which could see a rise to 21% from January 2026.
The above news was kindly provided by Fiscal Solutions (UK), www.fiscalsolutions.co.uk; contact: [email protected].
