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Czech Lawmakers To Decide On VAT Rate Cuts

by Ulrika Lomas, Tax-News.com, Brussels

29 April 2019


On April 17, 2019, the Czech Finance Ministry announced that legislation, which includes value-added tax cuts on water, sewerage, catering, and professional services, has been submitted to parliament for its third reading.

Under the measures, the rate of VAT on hairdressing and barber services, sales of draft beer, and repairs to bicycles, footwear, clothing and textiles will be reduced from 21 to 10 percent. In addition, VAT on water and sewerage charges will fall from 15 to 10 percent.

The bill also includes a further reduction in VAT on catering and soft drinks. This was recently cut from 21 to 15 percent, and will be further reduced to 10 percent.

The full list of goods and services to which the 10 percent reduced rate of VAT will apply under the proposals includes:

  • home care for children, old, sick and disabled people;
  • catering services and beverages, including barreled draft beer served as part of a catering service, but excluding catering services that are exempt from tax under Sections 57 to 59 of the Value Added Tax Act, and with the exception of tobacco products and other alcoholic beverages;
  • water treatment and distribution via networks, sewage disposal and treatment including other services related to these activities;
  • home cleaning services;
  • household window washing services;
  • minor repairs of shoes and leather products;
  • minor repairs and adjustments of clothing and textile products;
  • minor bicycle repairs; and
  • hairdressing, beauty and similar services.

TAGS: Finance | VAT rates | tax | value added tax (VAT) | food | legislation | Czech Republic | services | Tax

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