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Czech proposes consolidating reduced VAT rates 2024

Proposition to combine existing 15% and 10% reduced rates

The Czech Prime Minister, Petr Fiala, has confirmed that his government is considering consolidating the two reduced VAT rates of 15% and 10%. The single replacement rate would be 14% or 13%.  The current standard rate of 21% would go unchanged.

An economic evaluation is now underway. Any implementation date is likely to be 1 January 2024. When considering the change, per Fiala, the government will also assess the examples of other countries that temporarily reduced or abolished VAT on certain products.

The two reduced rates currently apply to the following supplies:

  • 15%: Foodstuffs; non-alcoholic beverages; take away food; certain medical; certain passenger transport; certain books / electronic; amusement parks; social housing; medical
  • 10%: Foodstuffs (baby and gluten-free); newspapers journals; water treatment; certain pharmaceutical; hotels; restaurants and hospitality; some books and e-books; medical; passenger transport; cultural events; public heating; rail; other

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In April 2022, there was agreement on EU reduced VAT freedoms which give member states the right to increase the number and range of reduced VAT rates. This is now in place, and must be implemented by all member states by 2025.



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