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Reduced VAT rates for electronic books, newspapers and periodicals

The Council has worked on a proposal to amend the existing EU VAT directive in order to allow member states to apply, if they so wish, lower VAT rates to e-publications such as electronic books, newspapers and periodicals.

The draft proposal is part of the EU's wider effort to modernise value added tax for the digital economy in the context of the EU's digital single market strategy.

The Council agreed on the proposal in October 2018. The directive will be adopted without further discussion once the text has been finalised in all official languages.

Why was the proposal made?

In most EU countries, e-publications are charged a standard VAT rate (a minimum of 15%). In contrast, publications on physical media can benefit from significantly lower rates, which may sometimes be reduced to 0%.

The amended EU VAT rules would contribute to the EU's pursuit of its digital single market strategy and, more broadly, help it to keep pace with technological progress in the digital economy.

Key elements of the draft amended directive

The proposal requires amendments to two articles and annex III of the current EU VAT directive (2006/112/EC). In essence, the amendments refer to the format of the publications to which the reduced VAT rate could be applied.

The draft amendment also specifies that "the supply of pure music and video content would continue to be taxed at the standard VAT rate".

According to the proposal, the standard rate would also continue to apply to publications that "predominantly" consist of music and video content. Member states would have the discretion to specify the term "predominantly" in their national VAT law. This solution would allow member states to continue to apply a reduced rate to audio books, audio newspapers and periodicals for people with sight loss.

Legislative procedure

Since the directive is in the area of taxation, the special legislative procedure applies. Under this procedure, the Council adopts legal acts after consulting the European Parliament.

See also

  • 1 January

    In the Council

  • 2018

    2 October

    Council agrees to allow reduced VAT rates on e-publications

    On 2 October, the Council agreed a proposal allowing member states to apply reduced, super-reduced or zero VAT rates to electronic publications, thereby allowing alignment of VAT rules for electronic and physical publications.

    However, super-reduced  and zero rates will only be allowed for member states that currently apply them to ‘physical’ publications.

    The new rules will apply temporarily, pending the introduction of a new, ‘definitive’ VAT system. The Commission has issued proposals for the new system, which would allow member states more flexibility than at present in setting VAT rates.

    The directive will be adopted without further discussion once the text has been finalised in all official languages.

  • 2018

    13 July

    Council discussed proposal on reduced VAT for e-publications

    On 13 July, the Economic and Financial Affairs Council discussed the proposal on reduced VAT rates for electronic publications. Ministers were unable to reach an agreement and agreed to discuss it again at the next Council in October.

  • 2018

    25 May

    Council discussed proposal on reduced VAT for e-publications

    On 25 May, the Economic and Financial Affairs Council discussed the proposal on reduced VAT rates for electronic publications. Ministers were unable to reach an agreement at this stage.

  • 2017

    16 June

    Council discusses a compromise proposal on VAT for electronic publications

    On 16 June, the Economic and Financial Affairs Council discussed the compromise proposal by the Council presidency on the new VAT rules, with a view to reaching an agreement (the Council general approach), however, the agreement could not be reached. 

    It will be expected in the second half of 2017.

  • 2017

    21 March

    Council debates the proposal on VAT rates for e-publications

    At the Economic and Financial Affairs Council meeting ministers held an orientation debate on the proposal to introduce the application of reduced VAT rates to electronic publications.

    The discussion focused on the possibility of applying not only 'reduced' VAT rates, but also 'super-reduced' and 'zero' VAT rates to e-publications.

    The Working Party on Tax Questions will continue its work on the proposal in the light of ministers' remarks.

  • 2016

    14 December

    Council's Working Party on Tax Questions starts working on the proposal

    The Council's preparatory body - the Working Party on Tax Questions - started working on the proposal.

  • 2016

    1 December

    Commission issues the proposal to amend the EU VAT directive

    The European Commission issued a proposal for a Council directive amending directive 2006/112/EC as regards rates of value added tax applied to books, newspapers and periodicals.

    The proposal is part of the VAT digital single market package, which, in addition to the proposal on e-publications, contains legislative initiatives that aim to:

    • facilitate cross-border trade
    • combat VAT fraud
    • ensure fair competition for EU businesses

  • 2016

    25 May

    Council invites the Commission to issue a proposal on VAT for e-publications

    The Council adopted conclusions on the Action Plan on VAT which invite the European Commission to present, by the end of 2016, a legislative proposal that would integrate provisions concerning VAT rates for e-publications in the context of digital single market initiatives. 

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