The new year will introduce many significant changes within the global VAT landscape. The scope of belated changes is quite broad, covering different pieces of the VAT puzzle. In the table below, you will find 20 important VAT changes for 2025.
It should be considered that shared updates are not exhaustive. There is also a broad spectrum of others that we haven’t included on this occasion. The changes impact different suppliers, from intra-EU goods supplies to digital service providers and introducing deemed supplier liability for digital platform operators.
| Important VAT Changes – 2025 | ||
| Country | Scope of the Change | Effective Date |
| Bulgaria | Abolishment of Reduced Rate for catering and restaurant services. Restoration of the usage of the standard VAT rate of 20% | January 1, 2025 |
| Canada | GST/HST relief on essential supplies(e.g.,holiday essentials, grocery, restaurant meals) | from December 14, 2024, to February 15, 2025 |
| Estonia | Accommodation services and accommodation services with breakfast are taxed at a rate of 13% instead of the reduced rate of 9%; Press publications will be taxed at a rate of 9% | January 1, 2025 |
| EU | Introduction of the new SME scheme | January 1, 2025 |
| EU | Introduction of the new rules for determination of the place of supply rules for B2C live-virtual events | January 1, 2025 |
| EU | Adoption of the final text of VAT in the Digital Age(ViDA) reform | 2025 |
| Guinea-Bissau | Implementation of the VAT regime | January 1, 2025 |
| Germany | Reduced Rate of 7% for intra-community acquisitions and domestic supplies of works of art | January 1, 2025 |
| Hungary | Extension of E-Invoicing scope to suppliers of electricity and gas within B2B | January 1, 2025 |
| Indonesia | Increase of the standard VAT rate from 11% to 12% | January 1, 2025 |
| Israel | Increase of the standard VAT rate from 17% to 18% | January 1, 2025 |
| Japan | Introduction of the deemed supplier rule for the provision of digital services via digital platforms | April 1, 2025 |
| Montenegro | Increase of the VAT rate for catering and restaurant establishments to 15% | January 1, 2025 |
| Montenegro | Increase of the VAT rate for short-term accommodation rentalfrom 7% to 15% | January 1, 2025 |
| New Zealand | Introduction of the Digital Services Tax levy on the income of digital marketplaces/platforms | January 1, 2025 |
| Philippines | Introduction of VAT obligation for resident and non-resident digital service providers | May/June 2025 |
| Slovakia | Introduction of the increased standard VAT rate of 23% | January 1, 2025 |
| Sri Lanka | Probable introduction of VAT liability for foreign providers of digital services without any threshold. | TBD |
| Switzerland | Introduction of Deemed Supplier Model for Platform Business Model | January 1, 2025 |
| Vietnam | The temporary reduced standard VAT rate of 8% has been extended for 6 months. Most goods and services in the scope of the standard VAT rate will be taxed under the reduced rate for an extended period. The reduced standard VAT rate will be used until June 30, 2025. | January 1, 2025 |
Aleksandar Delic
1stopVAT Senior Indirect Tax Researcher (Global Content)