Harmonization of EU VAT regulations may lead to a reduced rate

Poland may be facing the prospect of introducing a reduced VAT rate on numerous goods and services, as the European Commission, now calling for the harmonization of VAT regulations, has proposed lowering the VAT rate in "all sectors not directly competitive with EU markets." The long list, published in appendix H to EU VAT regulations, and favorable for Poland, mentions not only all construction-related services, but also includes all those goods and services for which Poland has been granted transitional periods. With the commission's motion carried, the lower VAT rate would be here for good. However; the list does not mention construction materials or equipment, or ecological fuel. To sweeten the bitter pill, the reduced VAT rate would comprise agricultural products and services, catering services, waste transportation and gas and power delivery. (www.onet.pl) J.K.