EC allows Poland to maintain reduced VAT rates

The decision, due to be announced in early July, would be great news for a range of other sectors in addition to housing, including bookstores, restaurants and farming. Their representatives had been bracing themselves for a sharp drop in sales next year as their VAT rates were to be raised to the standard 22%. When Poland was joining the EU the government negotiated a transition period for these sectors, with low VAT on books remaining at 0%, for farming products at 3% and on new residential building services and restaurant meals at 7%. The government had particularly feared the impact on the price of flats. Now it appears the problem has solved itself. The Commission's decision, which concerns all member states, reflects the fact that member states have been extremely slow to agree on a EU-wide overhaul of VAT, of which abolishing the lower rates is a part. (Gazeta Wyborcza, p. 1) R.M.