Reduced VAT rate on environmentally friendly products

The Czech Republic presented a proposal to the EU Environment Council to apply a reduced VAT rate to the supply of environmentally friendly goods. Currently, the European VAT Directive does not allow this option. Although it cannot be ruled out that subsequent negotiations on this topic will be initiated at the European level and that the VAT Directive will eventually be amended, we consider this rather unlikely. It is because the above-mentioned requirement simultaneously contradicts the concept of the CJEU on the system of VAT rates.

Source Deloitte

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