European Council adopts directive aligning VAT rules for electronic and physical publications

Released 6 November 2018

The European Council has adopted a directive allowing alignment of VAT rules for electronic and physical publications.

The adoption of the e-publication directive opens up the possibility for member states to implement reduced VAT rates in their national law if they wish to do so. Under the current VAT rules (directive 2006/112/EC), electronically supplied services are taxed at the standard VAT rate, i.e. minimum 15%, whereas publications on a physical support may benefit from non-standard rates. For physical publications – books, newspapers and periodicals – member states currently have the option of applying a ‘reduced’ VAT rate, i.e. minimum 5%, although some have been authorised to apply ‘super-reduced’ VAT rates (below 5%) or ‘zero’ rates (which involve VAT deductibility). The directive will allow member states that so wish to apply reduced VAT rates to electronic publications as well. Super-reduced and zero rates will only be allowed for member states that currently apply them to ‘physical’ publications.

For more information, see Electronic publications: Council adopts reform allowing reduced VAT rates.

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