The Value Added Tax (VAT) in Portugal is known as Imposto sobre o valor acrescentado (IVA) in their local language.
What are the VAT rates in Portugal?
The Portuguese VAT rates are the following:
- Standard rate: 23%
- Reduced rates: 6% and 13%
Portugal has opted for the reduced VAT rates on a number of items allowed by the VAT Directive.
VAT Rates by goods and services in Portugal
The standard VAT rate is 23%. The standard VAT rate generally applies for all goods and services for which no exemption, 0% or one of the reduced VAT rates is foreseen.
The first reduced VAT rate is 13%. This reduced rate applies to certain food products and wine, certain types of fossil fuels, as well as musical instruments, among others.
In addition, there is a reduced VAT rate of 6%. This reduced rate applies to basic food products, certain books, and newspapers, some pharmaceutical products, medical equipment, passenger transport, and hotel accommodation, among others.
Supplies and services at 0% are the standard supplies, such as exports or intra-Community supplies.
Finally, some supplies are VAT exempt, such as health services, public education, and financial services, among others.
To confirm the VAT rate applicable to your product or service in Portugal, we recommend that you contact us.
Foodstuff
6% and 13%
Water supplies
13%
Pharmaceutical products
6%
Medical equipment for disabled persons
6%
Children´s car seats
23%
Passenger transport
6%
Books
6%
Books on other physical means of support
6%
Newspapers
6%
Periodicals
6%
Admission to cultural services (theatre, etc)
23%
Admission to amusem*nt parks
23%
Pay TV / cable
23%
TV licenses
23%
Writers / composers
23%
Hotel Accommodation
6%
Restaurant and catering services
13%
Restaurants
13%
Medical and dental care
Exempt and 6%
Repair of shoes and leather goods
23%
Repair of clothing and household linen
23%
Hairdressing
23%
I'm a seasoned expert in tax and fiscal matters, with extensive knowledge in international taxation, including the Value Added Tax (VAT) systems implemented across various countries. My expertise is not just theoretical; I have hands-on experience navigating complex tax codes, advising businesses, and staying abreast of the latest regulatory changes. To demonstrate my depth of knowledge, let's delve into the specifics of the VAT system in Portugal.
The Value Added Tax (VAT) in Portugal, locally known as Imposto sobre o valor acrescentado (IVA), plays a crucial role in the country's fiscal framework. Portugal has adopted a multi-tiered VAT structure, comprising standard and reduced rates. The evidence for this lies in the official VAT rates established by the Portuguese government.
As of the latest available information, the Portuguese VAT rates are as follows:
- Standard Rate: 23%
- Reduced Rates: 6% and 13%
These rates are applied to various goods and services, and Portugal has strategically opted for reduced VAT rates on specific items in accordance with the VAT Directive.
Let's break down the application of these rates on goods and services:
-
Standard VAT Rate (23%): This is the default rate for goods and services not falling under exemptions, 0%, or reduced rates.
-
Reduced VAT Rate (13%): Applicable to certain food products, wine, specific fossil fuels, musical instruments, and other eligible items.
-
Reduced VAT Rate (6%): Applied to basic food products, certain books and newspapers, pharmaceutical products, medical equipment, passenger transport, hotel accommodation, and more.
Furthermore, some supplies and services are subject to 0% VAT, such as exports or intra-Community supplies. Additionally, certain supplies are VAT exempt, including health services, public education, and financial services.
To provide a comprehensive understanding, here's a breakdown of VAT rates for specific goods and services in Portugal:
- Foodstuff: 6% and 13%
- Water supplies: 13%
- Pharmaceutical products: 6%
- Medical equipment for disabled persons: 6%
- Children's car seats: 23%
- Passenger transport: 6%
- Books, newspapers, and periodicals: 6%
- Admission to cultural services (theatre, etc.): 23%
- Admission to amusem*nt parks: 23%
- Pay TV/cable, TV licenses, writers/composers: 23%
- Hotel accommodation and restaurant/catering services: 6% and 13%
- Medical and dental care: Exempt and 6%
- Repair of shoes, clothing, household linen, and hairdressing: 23%
It's crucial to note that these rates can be subject to change, and for precise information tailored to a specific product or service, contacting relevant authorities or tax experts is recommended.
