Public Consultation on reduced and super-reduced VAT rates for electronically supplied publications
The open public consultation will seek the views of business, the public and representative organisations
Period of consultation
From 25.07.2016 to 19.09.2016
Objective of the consultation
- Member States have the options to tax printed books, newspapers and publications at a reduced rate (minimum 5%) and some Member States were granted the applications of VAT rates lower than 5% (super-reduced rates) including exemptions with a deductions right of VAT at the preceding stage (so called zero rates) to certain printed publications. On the other hand, digital publications that are electronically supplied have to be taxed at the standard VAT rate.
- A harmonisation of VAT rates for electronically supplied services and in particular electronically supplied publications was a need until 2015. Since 1 January 2015, with the entry into force of new "place of supply" rules , VAT on all telecommunications, broadcasting and electronic services is levied where the customer is based, rather than where the supplier is located. Suppliers can therefore no longer benefit from being located in the Member State with the lowest VAT rates.
- While acknowledging the differences between printed and electronically supplied publications with regard to the format, they offer the same reading content for consumers and the VAT system needs to keep pace with the challenges of today's digital economy.
- Having carefully considered these issues, the Commission made a commitment in its 2016 Actions Plan on VAT (Com (2016) 148 final) indicating that it will make a legislative proposal in 2016 to allow Member States to apply to electronically supplied publications the same VAT rates that Member States can currently apply to printed publications.
The objective of the consultation is to seek the views on:
1. The commitment by the Commission in its 2016 Actions Plan on VAT to:
(a) allow Member States the application of reduced rates for electronically supplied publications
(b) allow Member States the application of super-reduced and zero rates for electronically supplied publications
2. The definition and scope of electronically supplied publications
3. The potential impacts of reduced rates for electronically supplied publications