Tax policy directorate – Bureau a

D. VAT IS A PROPORTIONAL TAX 
VAT is calculated by applying a proportional rate to the base amount of the transaction (free of VAT), 
whatever that amount may be. 
II – TAX BASE 
For the supply of goods, the provision of services and acquisitions within the EU, the tax base consists 
of all the sums, valuables, goods or services received or to be received by the supplier or service 
provider in return for them from the buyer, the customer or a third party, including subsidies directly 
linked to the price of such transactions. 
Accordingly, in addition to the agreed price, the tax base includes all taxes, duties and levies of any kind 
except VAT itself and all incidental expenses. Such expenses include transport, insurance, packaging, 
etc.
Conversely, the taxable price does not include price reductions (cash discounts, rebates, etc. granted 
directly to the customer) or amounts refunded to intermediaries who incur expenses on their principals' 
behalf, insofar as the intermediaries are accountable to their principals, enter such expenses in 
suspense accounts in their books and justify the nature or exact amount of such outlays to the tax 
authorities. 
The tax base for imports is the value defined by customs law in accordance with the prevailing EU rules. 
As with domestic goods and services, however, the tax base must include duties, taxes and levies, 
excluding discounts, rebates and other reductions, 
plus incidental expenses (commission, packaging, transport and insurance) to the destination point and 
expenses arising from transport to another destination point within the EU, if known when the taxable 
event occurs. 
Taxable persons are dispensed from paying VAT if their turnover during the preceding calendar year did 
not exceed: 
• 
€82,800 excluding VAT for supplies of goods, sales of food and drink to be consumed on the 
premises or accommodation services (€91,000 where turnover in the year before that did not 
exceed €82,800); 
• 
€33,200 excluding VAT for other services (€35,200 where turnover in the year before that did 
not exceed €33,200). 
Special rules apply for activities falling into the two categories mentioned above. There is also a 
€42,900 (excluding VAT) exemption limit for authors, artists, performers and solicitors.
Persons eligible for dispensation may elect to waive their right and opt to pay VAT.