Abolition of December advance VAT and withholding tax
The December advance payments for VAT and withholding tax have an important impact on the liquidity of companies. Last year we decided to cancel the payment of the VAT advances in December 2020. Today we confirm the structural abolition of this VAT advance and also the advance on withholding tax. In this way, we hope to improve the liquidity of the companies and to clarify and simplify the declaration and payment process.
Harmonize interests following the example of income taxes
The default and moratorium interests on VAT are no longer in line with the long-term low interest rate. They can amount to 9.6% on an annual basis, which can have a disproportionate impact on our businesses. That is why we scale all default and moratorium interests equally on the example of income taxes. This measure applies to the second quarter.
Harmonization of VAT refunds
In order to support the liquidity of our companies and to treat domestic tax liabilities in the same way as foreign taxpayers, the threshold amounts for the request for a refund of VAT are being aligned. The monthly and annual threshold amount is harmonized to 50 euros. The quarterly threshold amount to 400 euros.
Source Minister of Finance
