EU: Commission proposal on reduced rate of VAT for services with high level of labor

The European Commission proposed, on July 25, to allow 17 Member States to apply or maintain a lower rate of VAT until 31 December 2010. This proposal implements the provisions of directive 2006/18/CE authorizing a reduction of the VAT rate for some services. (Réf. 06757)
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Several Member States were already allowed to apply the reduced rate of VAT to certain services with a high rate of labor (restoration of private residences, hairstyle, window-cleaning, residence care and minor repairs) under the terms of a 1999 directive. These countries are Belgium, France, Italy, Luxembourg, the Netherlands, Portugal, Spain and the United Kingdom. These countries are allowed to maintain this reduced rate. In addition, eight new countries (Cyprus, Czech Republic, Finland, Hun

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