EU VAT Rates by Country (2026)

Key differences across the EU

Lowest standard rate: Luxembourg at 17% — making it a popular headquarters location for digital businesses selling across the EU (prior to the 2015 destination-based digital VAT rules).

Highest standard rate: Hungary at 27% — the highest VAT rate in the EU and among the highest in the world.

Most reduced rate tiers: France and Ireland each operate four distinct VAT rate levels (standard, two reduced, one super-reduced), making them the most complex for cross-border compliance.

Denmark: The only EU country with no reduced rate — Denmark applies its flat 25% rate to nearly all goods and services, with limited zero-rating for specific financial and medical services.

Significant recent changes: Estonia raised its standard rate from 20% to 22% in January 2024. Slovakia raised rates significantly in January 2025, with the lower reduced rate moving from 10% to 19% for many categories.

How EU VAT rates are set

Each EU member state sets its own VAT rates, subject to EU-wide minimums established in the VAT Directive: the standard rate must be at least 15% (no country approaches this minimum), and reduced rates must be at least 5%. Super-reduced rates below 5% are permitted only for historically grandfathered categories. The European Commission publishes an official rates table updated annually.

The EU's OSS (One-Stop Shop) scheme allows businesses selling to consumers in multiple EU countries to register in one member state and remit VAT centrally, rather than registering separately in each country. This significantly reduces compliance overhead for e-commerce and digital service providers.

VAT rates for cross-border transactions

B2C (business to consumer): For goods and services sold to consumers, VAT is generally charged at the rate of the customer's country (destination principle). An annual threshold of €10,000 applies — sellers below this threshold may charge their own country's rate.

B2B (business to business): Cross-border supplies between VAT-registered businesses are generally zero-rated under the reverse charge mechanism — the customer self-accounts for VAT in their own country. Always verify the customer's VAT registration before applying zero-rating.

Imports: Goods entering the EU from outside the EU are subject to import VAT at the destination country's standard rate (with reduced rates for qualifying product categories), calculated on the CIF value plus customs duty.

Reduced and special rate reference

• EU Reduced VAT Rates by Category — which countries apply reduced rates to food, books, medicines, children's clothing, and digital services
• EU Import VAT Rates — import VAT rates for all 27 member states with the calculation formula