VAT Rates Directive published

COUNCIL DIRECTIVE (EU) 2022/542 of 5 April 2022 amending Directives 2006/112/EC and 2020/285 as regards rates of value added tax has been published.

The Directive, which reflects the rules agreed to in December 2021, introduces amendments to the VAT Directive and the Directive relating to the special scheme for small enterprises which Member States are require to implement with effect from 1 January 2025.

These include:

• exclusion of admission to virtual events from article 53 of the Directive
• a new place of supply rule for services and ancillary services relate to activities which are streamed or otherwise made virtually available
• a new article 98 concerning the application of reduced rates by Member States, allowing Member States to adopt two reduced rates no lower than 5% to up to 24 categories of goods and services listed in Annex III, and in addition a reduced rate of less than 5% and an exemption with the right to deduct input VAT to up to seven categories of certain goods and services listed in Annex III