Tag Archives: tax increase

Luxemburg – e-books are subject to the standard VAT rate as of 1 May 2015

The Luxemburg tax authorities were rather quick to the react on the ECJ’s recent decision on the VAT treatment of e-books. As reported in our previous post, in the infringement procedure against Luxemburg and France the court held that these countries incorrectly applied reduced VAT rate to the sale of e-books.

It is confirmed in a “Circular” published by the tax authorities on 16 March that Circular 756 is revoked with effect from 1 May 2015, and as of that date the standard VAT rate of 17% should be applied to the sale of e-books. (Please refer to the news update on PwC’s GlobalVATOnline.)

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Czech Republic – introduction of reduced VAT rate from 1 January 2015

The Czech Republic is going to introduce a new VAT rate into its VAT legislation with effect from 1 January 2015.

On 6 November, the president of the Czech Republic signed the amendment to the current VAT law introducing a VAT rate of 10% from 1 January 2015. As a result of this, the Czech VAT law will have two reduced VAT rates.
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Hungary – Creative taxation: Internet Tax proposed

Earlier this week the Hungarian government submitted its proposed tax bill for 2015. One of the most interesting changes is the proposed introduction of the “Internet tax” that will be imposed on Internet service providers at a rate of HUF 150 (approx. USD 0.60) for every gigabyte of data or part thereof. By way of example, downloading a movie in HD quality (8.5 GB) would attract a tax charge of approx. USD 5 or the download of a 6GB game would have an additional cost of approx. USD 4 according to the original version of the proposal. You may expect that providers will try to recharge this cost to their customers, which makes surfing even more expensive.

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Montenegro: Proposed VAT rate increase from 1 July 2013

The government proposes a 2% increase in the standard VAT rate from 17% to 19% in Montenegro. If the proposal is accepted by the Parliament, the VAT rate increases will take effect from 1 July 2013.

What does it mean for you

We recommend reviewing the VAT implications on your business operations in Montenegro due to these changes, to ensure full compliance with regard to VAT rules, rates and regulations. Systems must be adjusted and contracts may need to be reviewed. Please see news update on PwC’s GlobalVATOnline here.

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Luxembourg: VAT rate increase as of 1 January 2015

In his recent “State of the Nation” speech Luxembourg’s Prime Minister, Jean-Claude Juncker announced that the standard VAT rate in Luxembourg will increase with effect from 1 January 2015 (i.e. from the date when the new VAT rules for B2C sales of eservices will become applicable in the EU). Mr. Juncker has explained, that this VAT rate increase should help Luxemburg to counterbalance the expected loss of the VAT revenues due to new VAT rules on eservices.

Current standard VAT rate in Luxembourg is 15%. Even though the new VAT rate has not been disclosed yet, we understand that the Luxembourg’s government intends to maintain the lowest standard VAT rate in the EU also after the proposed increase. This would mean that the new standard rate will have to be somewhere between 16% and 18%. Find out more

Czech Republic and Finland: VAT rates increasses now official

Some time ago, we have announced that Finland and Czech Republic are planning to increase their VAT rates on 1 January 2013. This has indeed come to fruition as reported; both countries have increased all their VAT rates by 1% as of today morning.

Some more info can be found here and here. Please remember, Cyprus also plans to increase its VAT rates soon.

P.S. and without being cynical in any way: We wish you all a happy and most successful 2013!

Cyprus: VAT rate increase on 14 January 2013

Cyprus is again increasing its VAT rates.

The standard VAT rate will increase from 17% to 18% for the period 14 January 2013 to 12 January 2014. From 13 January 2014 the standard VAT rate will increase again to 19%, at which point the 8% reduced rate also rises to 9%. The current reduced rates of 5% and 0% remain unchanged.

Original news can be found here.

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France Proposed VAT rate increase in 2014

The French government announced tax rate changes as part of a planned tax relief for companies last week. The proposal intends to make the French companies more competitive on the international market, however in return the VAT rates will be increased.

According to the announcement the standard VAT rate would increase from the current 19.6% to 20%, while the reduced VAT rate would increase from 7% to 10%. Some good news, that the super-reduced VAT rate is proposed to decrease from 5.5% to 5%.

As per the information published the VAT rate changes will be effective from 1 January 2014.

What does this mean for you?

Any change in the VAT rates in France will affect businesses both as suppliers and as customers. Businesses VAT registered in France, doing or planning doing business in France should therefore keep abreast with the developments.