Netherlands VAT rate proposals

The Dutch government is considering raising the Netherlands VAT rates on a number of supplies. The move would involve reclassify a number of goods and services from the reduced VAT rate of 6% to the standard Dutch VAT rate of 21%.

The supplies include:

• Medicines and pharmaceuticals
• Entrance to sporting, cultural and entertainment events
• Restaurant food and related services
• Hotel accommodation
• Newspapers and books (e-books are already at 21%)

Under the proposals, only the supply of basic foodstuffs would remain at the current reduced rate.

The Dutch VAT rate increased from 19% to 21% in October 2012 to help the government cope will a rising GDP to sovereign debt %, one of the key metrics for membership of the € currency.  The IMF had recommended a full merging of the rates in 2014.