New reduced VAT rate introduced

LN 231 of 2023 has introduced a reduced rate of 12% which will apply, with effect from 1 January 2024, to 4 categories of services:

  • Custody and management of securities
  • Management of credit and credit guarantees by a person or body other than those who granted the credit
  • Hiring of a pleasure boat for a period not exceeding 5 weeks (subject to the conditions specified)
  • Services consisting of the care of the human body by a medical professional (subject to the conditions specified)

The legal basis for the new VAT rates included in the Eighth Schedule to the VAT Act is article 105a of the VAT Directive 2006/112EC introduced by Council Directive (EU) 2022/542 (the VAT Rates Directive)…(read more…)