New VAT rates on the horizon

The approved consolidation package from 2025 will bring significant changes in the area of VAT, which will fundamentally affect the business environment and consumer prices in the Slovak Republic (hereinafter referred to as the “SR”).

The most significant change is the increase in the standard VAT rate from 20% to 23%. The current reduced tax rate of 10% will also be abolished and replaced by a reduced rate of 19%. The reduced tax rate of 5% will remain, but the range of goods and services to which it will apply will be modified.

Below are some examples of the application of reduced VAT rates. The detailed list of goods and services to which the particular reduced rates will apply will be set out directly in the Annex to the Act.

• reduced rate of 5% – basic foodstuffs (meat, bread, butter, milk, fruit, vegetables, etc.), medicines, pharmaceutical supplies, books and magazines, accommodation services, restaurant and catering services (only for serving meals), admission to sporting events and fitness centres, etc.;
• reduced rate of 19% – other foodstuffs (except basic), electricity, restaurant and catering services (only for the serving of soft drinks) and others.

The above changes in VAT rates take effect from 1 January 2025.