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Increase of the low VAT tariff from 6 to 9%, consequences for entrepreneurs

This information is provided by

Netherlands Chamber of Commerce

From 1 January 2019, the low VAT tariff is 9%. Does your business provide services or products within the low VAT tariff bracket? Here is how you can deal with the change.

The 9% VAT tariff is a fact

On 1 January 2019, the raise of the low VAT tariff from 6% to 9% came into force.

VAT raise only applies to services and products previously in the 6% bracket

Certain services, provided by for example bicycle repair men, hairdressers and tailors, are in the low VAT bracket. Check to see if your services are in the low VAT bracketExternal link (only available in Dutch). The low VAT tariff also applies to certain products, for instance food, books and medicines. Check to see if your products are in the low VAT bracketExternal link (only available in Dutch).

Consequences of the raise

Your quotations will have to contain the new low VAT tariff of 9%.

In your VAT return for the first quarter of 2019, you will have to use the new 9% tariff. This also means that you will have to charge your customers 9%, if you previously charged them 6%.

You’ll need to have adjusted the low VAT tariff from 6 to 9% everywhere you use it: in your cash register or point-of-sale system, your accounting software, your VAT records. If you have not adjusted the traiff yet, your quotations and invoices will have to be adjusted manually, so make the change as soon as possible.

Think about increasing your prices

Your private customers pay a price that includes VAT. You can calculate the VAT increase in your sales price, and maintain your gross profit. Or, you can keep the prices at the same level – but then your profit will go down. If you increase the sales price including VAT, your business customers will pay more too. Since most entrepreneurs can deduct VAT, they will effectively pay the same price for your services or products.

This information is provided by

Netherlands Chamber of Commerce