Proposal: Reduced VAT Rate for Olive Oil Production Activities

Portugal’s 2026 draft budget bill proposes applying the reduced VAT rate (6% on the mainland and 4% in Madeira and the Azores) to olive oil production activities.

VAT Group Scheme

Portugal introduced a voluntary VAT group regime, which will apply to tax periods beginning on or after 1 July 2026, allowing eligible entities to register and report under a single VAT number.

Update VAT Decree on Taxable Amount, Fuel Cards, and Negative Interest

The State Secretary for Finance has issued a decree clarifying the determination of the VAT taxable amount and the VAT treatment of fuel cards.

VAT Exemption for Intermediation Activities in Shares and Securities Transactions

The State of Secretary for Finance has clarified the VAT exemption scope for intermediation activities in shares and securities transactions, particularly to corporate finance activities.

Import VAT Rules Repealed

Further to the Romanian Customs Administration’s recent update to the rules concerning the new special import scheme, Romania has issued Order No. 2.201/2025 to repeal outdated import VAT regulations.

Extension Granted for RO E-Invoice Implementation

Romania has extended the deadline for the mandatory use of the RO e-invoice for farmers and foreign cultural institutes until 1 June 2026.

Prefilled VAT Return Introduced Following VAT Rate Increase

Romania has enacted Order No. 2351/2025 with respect to the format and content of the prefilled VAT return.

Amendments to RO E-VAT Compliance Notice

Romania has published Order No. 2394/2025 amending the RO E-VAT Compliance Notice with respect notably to proposed amendments to the prefilled VAT return and the standard VAT return. In addition, the obligation to reply to this notice within 20 days was postponed until the end of the year.

Tax Reform Bill to Consolidate Public Finances

The Slovak Republic has published a bill introducing VAT changes related to sweet and savoury foods, as well as business vehicles not used exclusively for business purposes.

VERI*FACTU Systems from January 2026

Starting January 2026, taxpayers subject to corporate income tax in Spain will be required to issue invoices using VERI*FACTU-compliant invoicing systems. From July 2026, this obligation will extend to all other taxpayers established in Spain. Taxpayers already using the Immediate Supply of Information (SII) system are exempt from this requirement.

Proposal: 2026 Budget Bill

The government has presented its 2026 budget bill, which includes:

• The extension of VAT liability to remotely supplied services purchased abroad and used by Norwegian branches of foreign enterprises
• The disallowance of output VAT loss recognition on receivables from related parties after 24 months
• A reduction in the VAT exemption threshold for electric vehicles to NOK 300,000

Romania Implements New VAT Rules

Romania has introduced new VAT rules through Government Ordinance No. 22/2025. The changes include implementing the EU SME VAT scheme; updating the place-of-supply for virtual and live streaming events; and postponing the requirement to respond to RO E-VAT notices within 20 days until 31 December 2025, along with related penalties for non-compliance.

Authorisation Rules for Special Import Scheme Updated

The Romanian Customs Authority has issued Order No. 2618/2025, updating the rules for authorising and using the Import One Stop Shop (IOSS) scheme for declaring and paying import VAT.

Key changes include:

• A new requirement that applicants must not appear in the special register of inactive taxpayers
• Changes to the format of the authorisation number

VAT Return Form Updated Following VAT Rate Increase

Romania has officially published Order No. 2131/2025, approving the updated VAT return form (D300) to reflect the VAT rate changes effective 1 August 2025.

New VAT Refund Procedure for NGOs Operating Hospitals

Romania has introduced Order No. 1480/2025, setting out a VAT refund procedure for acquisitions by non-governmental organisations (NGOs) and their subsidiaries for hospitals. This applies only to supplies made before 1 August 2025, and the deadline for submitting VAT refund requests is 31 October 2025.

Romania Updates Form 394

Romania has updated the format of the local sales and purchases list (Form 394), effective August 2025, to align with the VAT rate changes.

Proposal: VAT Rate Increase and Limits on Input VAT Deductions

Starting in 2026, the Slovak Ministry of Finance has proposed:

• Increasing VAT on foods high in sugar and salt from 19% to 23%
• Capping input VAT deductions on motor vehicles and related expenses at 50% in certain cases
• Introducing a tax amnesty for taxpayers who settle outstanding liabilities or report additional liabilities in their tax returns during the first half of 2026

Proposal: VAT Rate on Food Halved

The Swedish Ministry of Finance has proposed reducing the VAT rate on most food products from 12% to 6%, effective April 2026 to December 2027.

Proposal: 2026 VAT on Residual Expenses

The Swedish government’s 2026 Budget Bill includes clarifications on rules for deducting input VAT on residual expenses.

Proposal: VAT Cut for Dance Events

The Budget Bill also proposes reducing VAT on admission to dance events from 25% to 6%, starting 1 July 2026.

HMRC Updates Interest Rates for Late and Early Tax Payments

On 8 August 2025, HM Revenue & Customs (HMRC) released updated guidance on interest rates, including an 8% default interest rate for late VAT payments effective 27 August 2025.

VAT Statement Following Rate Increase Updated

The Romanian tax authority has published a draft law for public consultation to update Form 394 (local sales and purchase list) further to the recent increases in the VAT rates.

Interest Rates for Late Payment and Repayment of VAT Reduced

The Treasury announced a decrease in the interest rate for late VAT payments from 6.75% to 6.50%, and in the repayment interest rate from 3.25% to 3.00%, effective from 27 August 2025.

Certain Private Hire Vehicle (PHV) Operators Not Liable to Charge VAT on Bookings

The UK’s Supreme Court has ruled that PHV operators notably outside London do not automatically enter into contracts with passengers when accepting bookings on the basis that the relevant law only contained a deeming provision, which did not create an actual contract between the operator and passenger, and that PHV operators may therefore not be liable to charge VAT on bookings.

VAT Threshold Increase for Small Enterprises

Poland has increased the VAT threshold for small enterprises, from PLN 200,000 to PLN 240,000, effective from 1 January 2026.

Reduced Penalties for Early VAT Return Correction

Effective 1 October 2025, taxpayers in Poland who correct their VAT returns and settle any outstanding VAT within 14 days of receiving a customs or fiscal audit notification will benefit from a penalty capped at 15% on the VAT due related to the identified discrepancy.

Continued Application of Reduced VAT Rate for Residential Redevelopment

The Federal Public Service for Finance has confirmed that, despite parliamentary delays, the reduced 6% VAT rate for the demolition and reconstruction of residential buildings remains in effect from 1 July 2025.

Clarifications Related to Mandatory B2B E-Invoicing

The Belgian Federal Public Service for Finance published in the Official Gazette of 15 July a decree with clarifications on the requirements for the mandatory structured e-invoicing that will apply to all taxable persons established in Belgium, as of 1 January 2026.

VAT Treatment of Shared Office Cost Recharges

The Italian tax authority clarified that recharges for shared office expenses between lawyers are fully subject to VAT, as the arrangement does not qualify as a mandate without representation for purchasing goods and services (ruling no. 189/2025).

Clarification: VAT Role of Fixed Establishments in Contract Negotiations

The Italian tax authority has clarified that active involvement by a fixed establishment in contract negotiations may trigger VAT obligations, requiring it to apply reverse charge on intra-EU transfers and VAT on domestic sales.

VAT Exemption Regime for Overseas Territories Updated

France has updated the VAT exemption import regime for its overseas departments of Guadeloupe, Martinique, and Réunion, introducing lists of eligible goods specific to each department and valid in all three departments applicable from March 2025 to December 2027.

Increase of Late VAT Payment Penalties and Extended Final VAT Return Deadline

As of 31 July 2025, the penalties for late VAT payments will increase to 3% (from 2%) for lack of VAT payment within the first 15 days, with a further 3% (from 2%) if still unpaid within 30 days and 10% (from 4%) if still unpaid thereafter. From 1 July 2025, the Treasury may extend the deadline for submitting a final VAT return under certain conditions.