Poland considers single VAT rate
- Jun 11, 2014 | Richard Asquith
Poland is reviewing combing its standard and reduced VAT rates to create a single rate for all taxable goods and services
This new proposal comes from the Finance Ministry with the idea of simplifying VAT compliance process. It is believed that the combined rate would be either 17% or 18%. Other countries, such as the Czech Republic, has put forward such plans but with no conclusion. It follows the original post-Soviet era countries’ plans for flat taxes which were rolled back following the start of the financial crisis in 2007.
EU rules on VAT rates
The 28 member states of the EU are free to set their own standard VAT rates within the rules of the EU VAT Directive. The standard VAT rate must be at least 15%, and they are permitted two reduced VAT rates of 5% or above. There is also scope for nil VAT rates on goods where the rate was applicable prior to entry into the EU by the country.