Global reduction of the VAT rate – a response to Covid-19

Countries around the world are beginning to respond to the global crisis caused by Covid-19. They are beginning to introduce tax breaks to support the economy, which has already been strained by the crisis. Below we present this information and we will keep it updated. We will also take these reductions into account when submitting VAT returns.

Latest Updates:

  • Greece June 22, extends VAT reduction until September. VAT reduction applies to various products.

  • Czech Republic  June 22, VAT reduction to 10% for events and accommodation

  • Great Britain June 21, temporary VAT reduction possible. Please note that the deferred VAT payment has ended.

  • Germany  June 21, implementation of temporary VAT reductions from 19% to 16% from 1st of July until 31st of December.

  • Italy  June 17, considering a VAT reduction. VAT payments delayed until 16th of September.

  • Belgium  June 17, June and July option to delay VAT refund. Catering services receive VAT reduction from 12% to 6%.

Information by region:

Europe

  • Greece June 22, Greece is delaying the VAT reduction. VAT payments delayed until September. VAT reduction on various products.

  • Czech Republic  June 22, VAT reduction to 10% for events and accommodation.

  • Great Britain  June 21, temporary VAT reduction possible. Please note that the deferred VAT payment has ended.

  • Germany  June 21, details of the implementation of temporary VAT reductions from 19% to 16%.

  • Italy  June 17, Italy is considering a VAT reduction. VAT payments delayed until 16th of September.

  • Belgium  June 17, June and July option to delay VAT refund. Catering services may receive VAT reduction from 12% to 6%.

  • Romania June 16, proposes zero VAT on hotels. Introduces accelerated VAT concessions.

  • Austria  June 12, reduced VAT rate for restaurants. Reduces the soft drinks VAT to 10%. Deferment of penalties.

  • Slovakia  June 11, non-resident entrepreneurs can apply for VAT payment deferment

  • Bulgaria  May 11, confirms the reduction of the VAT rate on gastronomy, restaurant, electronic and printed books to 9% by December 31, 2020.

  • Denmark  June 3, new delays in VAT payments. VAT loans for small businesses./span>

  • Cyprus May 28, accommodation and hospitality reduced VAT rate from 9% to 5% from July to January 10, 2021.

  • Poland  May 27, Poland offers a delay in the payment of VAT. The extension of the SAF-T VAT reporting has been delayed.

  • Netherlands  May 27, reduced late payment fee. Discounts for VAT extended until September 30, 2020.

  • Malta May 27, deferred VAT payments until the end of June must be paid by October 31.

  • Spain May 25, emergency Value Added Tax filing deadline postponment measures (below) are to be withdrawn on 1-4 June 2020.

  • Macedonia  May 25, delays VAT refunds.

  • Portugal  May 23, VAT reduction on fitness clubs and gyms. 

  • Slovenia  

  • Luxembourg  May 15, VAT penalties are imposed for late returns. Companies may apply for deferred VAT payments.

  • Norway  May 13, January-February VAT refund delayed until June. Reduced VAT rate from April 1. Deferred VAT.

  • Ireland May 12, update – exemption from interest on June and July VAT payments

  • Finland  May 8, reduced interest for late payment. Companies are offered VAT loans with a 3% interest rate. 3-month delays in VAT payments.

  • France  VAT refund deadline extended to 30 September 2020. Discounts on VAT payments for April and May. PDF and scanned invoices are valid for VAT instead of paper.

  • Hungary  May 1 update, new bank tax. Quick refund of a VAT loan. Emergency retail tax. Delays in the payment of VAT on application.

  • Ukraine  April 30, reduced VAT rates. Ukraine will not charge default interest on VAT payments until May 2020.

  • Russia April 28, limited delays in VAT returns for the first quarter.

  • Turkey April 24, second deferment of VAT payments and declarations.

  • Iceland April 23, new payment date, May 6. Suspension of accommodation tax.

  • Croatia  April 16, deferral is available upon request for March and April VAT returns.

  • Lithuania  April 15, they are considering reducing the VAT rate on hotel services. Confirmed delays in VAT payments or write-offs up to one year. 

  • Sweden  April 9, updated the cash VAT system and extended reporting periods for small businesses. Earlier, deadlines for penalties and interest on VAT payments postponed for up to one year.

  • Moldova  April 1, the VAT rate reduction for hotel services will be from 20% to 15% (not 10%)

  • United Kingdom and Jersey  March 31, defers GST payments from March to May.

  • Latvia March 24, offers delayed tax payments and quick VAT refunds.

  • Estonia  March 23, VAT payment delays until May 1. But further relief is promised.

  • Switzerland March 23, Businesses may extend payment periods for value added tax (VAT), customs duties, special excise taxes, and incentive taxes, without having to pay interest. For this reason, the interest rate on late payments will be reduced to 0.0% in the period from 21 March 2020 to 31 December 2020. No interest on arrears will be charged during this period.

  • Georgia  doubles the funds for refunding a company VAT loan.

North and Central America

  • Costa Rica June 10, annual VAT reduction; better deductions from tourism

  • United States  June 9

  • Mexico  On June 9, is considering a VAT reduction

  • Canada  On May 20, the federal government predicts GST / HST payment delays until June. Saskatchewan provides automatic payment delays until July 31.

    Earlier: GST federal delays; Quebec postpones the sales tax refund until June 30; Ontario allows the waiver of the application, but not HST. Manitoba joins British Columbia, offering delays in sales taxes in the provinces. The federal government has already suspended controls.

  • Panama April 20, delays VAT submission by 120 days.

  • Guatemala March 29, permits late VAT refunds.

  • Jamaica plans to reduce the overall consumption tax from 16.5% to 15%.

Near East

  • Israel May 19, postponed VAT declarations and payments

  • Saudi Arabia  raises VAT to 15%

  • Lebanon  May 2, deferment of VAT refund in the first quarter

  • Palestine May 3, VAT refunds and suspension of fines.

  • Iran April 9, delays VAT refunds during the COVID-19 crisis.

Africa

  • Egypt May 15, 3-month VAT payment in the tourism sector

  • South Africa  May 7, relief for small VAT payers. Limited VAT concessions.

  • Botswana May 4, delayed VAT returns.

  • Senegal April 23, quick VAT reduction.

  • Kenya April 18, update, VAT reduction to 14% confirmed and dated to April 1, 2020.

  • Uganda March 29, defers VAT compliance requirements.

  • Tunisia March 30, acceleration of the VAT relief.

  •  Nigeria March 27, delays the deadline for submitting VAT returns.

Asia

  • Pakistan June 16, reduction of sales tax on electronic cash registers. Second delay of sales tax refunds

  • India June 15, GSTR returns are delayed again. Electronic account validity period extended. It further delays the annual GST return

  • Thailand,  June 11, VAT on foreign digital e-services. Delays VAT refund

  • Malaysia June 3, sales and service tax returns and payments delayed until June 30

  • China May 23, VAT credits extended until December 31, 2020

  • Taiwan May 19, quick VAT discounts available

  • Philippines May 6, delays in returning VAT. Further extension of return periods in May.

  • Indonesia On April 24, she raised the VAT credit limit. It will also provide deferred import VAT payments for businesses.

  • South Korea On April 17, it exempts small taxpayers from paying VAT until December 31, 2020. It has already reduced VAT for small businesses, and received tax breaks for consumers who change their cars early. Provided tax relief on expenses for personal credit cards.

  • Japan On April 16, companies can apply for exemption from consumption tax. Delays in the annual consumption tax application.

  • Vietnam On April 13, e-invoicing was postponed. Agreed 5-month VAT payment for companies and households. Vietnam proposes a reduction in VAT for restaurants, hotels as well as transport and tourist companies.

  • Kyrgyzstan April 13, delays in VAT and e-invoicing.

  • Philippines April 11, a 15-day delay in returns in the first quarter is expected on April 30

  • Singapur April 7, GST returns and payments delayed by one month.

  • Sri Lanka March 31, withdraws VAT payments from February and March.

Oceania

  • New Zeland May 1, the right to submit a GST application, change the reporting period or delay payment. Limited help for companies in the field of value added tax.

  • Australia April 17, import of GST exemption.

South America

  • Uruguay June 12, delay in entering the e-invoice. Delays in the payment of VAT

  • Columbia June 11, reduced default interest rate. Exemptions from VAT in the sectors most affected by the crisis Suspension of VAT for 3 days.

  • Argentina May 23, VAT refunds and late payment

  • Paraguay May 23 delays VAT on e-services

  • Bolivia May 22, delayed implementation of e-invoices. Extends VAT returns and payments until July

  • Peru May 19, up to 6 months delay in VAT payments

  • Chile May 12, deferment of VAT payments. Chile has already provided a VAT gap by the end of June for small businesses.

  • Brazil April 7, update 4-month delay in PIS / COFINS payments. Brazil has already suspended tax audits and relaxed the rules for imports.

  • Ecuador April 6, shifts in returns.

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