Proposed new standard VAT rate
A discernible effect over the past few years has seen countries in Europe exercising increased flexibility regarding their VAT rates. Two main factors have served as a catalyst for these changes: the Covid Pandemic, which sharply brought fiscal strategies, and strictly, VAT and other tax rates, into focus as a means of attempting to stabilise the economy and secondly, increased concessions granted by the European Commission, which affords EU Member States with greater flexibility to dictate their own VAT rates. The latter particularly means that going forward, tax rate changes are expected to feature prominently as an integral part of country tax strategy.
Following the path of Estonia, and potentially the Czech Republic in 2024, Slovakia is the latest country to announce a proposed VAT increase to its standard VAT rate.
In line with Estonia, Slovakia is proposing to increase the standard VAT rate from 20% to 22%, arguing that the current 20% VAT rate is lower than the EU average and that the 2% increase is therefore justified.
The VAT increase is yet to be approved by the newly elected Parliament and is expected to take effect some time in 2024.
Slovakia is a compliant territory for Kofax and if confirmed, we are committed to supporting the new standard VAT rate as part of our e-invoicing solution in the country.