Global Daily Tax News, Seven EU States Instructed To Implement New VAT Rates Directive, (Feb 3, 2025)

Belgium, Bulgaria, Greece, Spain, Lithuania, Portugal, and Romania have been reprimanded by the European Commission for failing to transpose in full the EU Directive on rates of VAT, Directive 2022/542.

Member states had to communicate on the full transposition of this Directive into national law by December 31, 2024.

The Directive on rates of VAT allows for a wider use by member states of reduced rates, including the use of zero rates for essential products such as food, pharmaceuticals, and products intended for medical use. Furthermore, country-specific VAT rates called derogations were opened to all member states, thus ensuring equal treatment across the European Union.

The member states have received letters of formal notice from the European Commission, requiring that they complete their domestic implementation processes within two months and notify the Commission of their national measures. The Commission may otherwise escalate infringement proceedings against the nations.