Parliament votes to extend minimum 15% VAT rate in Europe
Parliament voted on Tuesday to extend for three more years the 15% minimum VAT rate within the EU while it awaits the publication of a plan for a Europe-wide VAT regime, scheduled to be released this year.
MEPs voted by 568 votes to 80 votes against, with 59 abstentions to endorse a proposal by the Commission—backed by Parliament's Economic and Monetary Affairs Committee in March—to support the continued standard rate at 15%, until the end of 2018. The vote comes as the Commission prepares to publish an action plan to overhaul the current system of variable VAT rates within Europe with a simple, efficient and fraud-proof VAT regime for a single market.
Currently, all member states within the EU levy a standard rate above 15%, but the system of a minimum rate which was introduced in 1993, and has been extended ever since, is designed to allow for VAT reforms aimed at reducing the standard rate by broadening the VAT base and limiting the use of reduced rates.