New VAT rules from 2022

Brussels, 13.12.21. The MEP of the Ökologisch-Demokratische Partei (ÖDP) Manuela Ripa has spoken out in favour of a reduction of the VAT on climate- and health-friendly goods. The background is the agreement of the EU member states to make the design of VAT more flexible from 2022.

“I expressly welcome the idea of a VAT reduction for certain products. The aim must be to use it to reduce the price of climate-friendly and health-promoting goods, e. g. regional fruit and vegetables,” emphasised the ÖDP politician. The new flexibilisation of VAT allows for the promotion of such products, but its concrete form is still unclear.

Goods such as medicines or foodstuffs that cover basic needs could be exempted from VAT altogether in future. The aim is above all to promote the health sector, digitalisation and the change to a more environmentally friendly economy.

Ripa: “Reducing VAT for climate-friendly and health-promoting products is an overdue step.”

MEP Ripa advocates using these reductions for particularly environmentally friendly and sustainable goods, but would also like to put the tax support for climate-damaging products to the test: “In return, we must also talk about withdrawing the reductions on climate-damaging and health-damaging goods. This would make it possible to remedy abuses such as the fact that plant-based alternatives to milk are still subject to the full VAT rate, while meat is subject to a reduced rate. Existing VAT exemptions for goods that harm the EU’s climate goals must be clearly suspended until 2030.”

Especially on the issue of health prevention, the MEP of the ÖDP only recently advocated a tax reduction for healthy food in the special committee on cancer. One of the demands of the final report is directed at the Member States to use pricing policies such as VAT differentiation and marketing controls specifically for health prevention: “Healthy foods and beverages with low levels of saturated fats, trans fats, salt and sugar must be affordable and easily accessible. At the same time, unhealthy foods should be given the same advertising ban as alcohol and tobacco. One of my heartfelt issues is to promote the prevention of cancer. Fruit and vegetables can be proven to have a preventive effect here in the diet, this is where the reduction of VAT makes great sense, especially as the new agreement allows for a reduction down to 0%,” Ripa concludes.

 

Photo Credit: Adobe Stock