Minimum VAT rate extended for two years

On 25 May 2016, the Council adopted a directive maintaining for a further two years the minimum standard VAT rate at 15%. 

The minimum standard rate is aimed at preventing an excessive divergence in VAT rates applied by member states, and the structural imbalances or distortions of competition that could arise as a result. A minimum standard rate of 15% was applied until 31 December 2015. 

In view of on-going discussions on definitive rules for a single European VAT area, the directive extends the minimum standard rate for a period long enough to ensure legal certainty. It maintains the rate at 15% from 1 January 2016 until 31 December 2017. 

The directive was adopted without discussion at a meeting of the Economic and Financial Council.

• 2016 draft directive maintaining the minimum standard VAT rate
• VAT action plan, Towards a single EU VAT area