VAT levies on goods and services such as solar panels, water, passenger transport and live streaming of sports matches or shows can be reduced in the EU to a rate of between 0 and 5 percent.

It is up to the new Dutch cabinet to decide whether or not to make use of the option, emphasizes a spokesperson for the Ministry of Finance.

After years of negotiations, EU finance ministers have agreed to extend a directive that allows a reduced rate of between 0 and 5 percent for seven categories.

With the revised directive, Member States will have more room to set lower VAT rates, as long as there is no distortion of competition.

The benefit must also reach the consumer.

For example, a low rate between 0 and 5 percent can be applied to pharmaceuticals, medical equipment, book delivery and library lending.

The Netherlands has argued in the past for the use of a zero rate, but this was only possible in specific cases, such as the supply and supply of ships and aircraft.

Due to the corona crisis, the outgoing cabinet also temporarily introduced a zero rate for corona test kits and approved COVID-19 vaccines.

That measure expired at the end of September.

In the Netherlands, the general VAT rate is 21 percent.

A reduced value added tax (VAT) of 9 percent applies in the Netherlands to a limited number of goods and services.

The EU countries may determine the level of their VAT rates themselves, but the general rate may not be lower than 15 percent.

One or two reduced rates may apply to certain products and goods, but they must be at least 5 percent.

Reduced VAT rates on fossil fuels such as oil, gas and coal will no longer be allowed from 1 January 2030.

The same applies from 1 January 2032 for fertilizers and chemical pesticides.

Keywords: