Senate to discuss new VAT bill, government to fight amendments

The main changes in the law concern raising the VAT rate on construction materials from 7% to 22% and on children's goods from 0% to 7%. However, until April 30, 2007, construction and renovation services and the sale of finished apartments will be covered by the reduced 7% rate. Deputies withdrew the most controversial proposed amendments, namely that of charging VAT on contracts performed by individuals - namely contracts to perform a specific task and contacts of mandate. The compliance of the new law with EU regulations is questioned by experts; the government plans to convince the Senate to restore the government original proposals where they had been rejected by the Sejm. (Rzeczpospolita, Feb. 21-22, p. A1) T.J.