InsiderBusinessFinance Ministry clarifies which products will be exempt from VAT

Finance Ministry clarifies which products will be exempt from VAT

The Ministry of Finance has issued a statement clarifying which essential goods are now exempt from VAT, according to a Cabinet decree to address the cost-of-living crisis:

  • Bread: all types of bread, fresh or frozen, with or without sourdough (e.g. white, black, wholemeal, multigrain, rustic, rye, cornbread, baguettes, ciabatta, sliced bread, pitta bread).

Bakery products, dried bread and any bread with added ingredients such as raisins, nuts, and flavourings are excluded.

  • Milk: fresh milk (e.g. cow, goat, sheep), sweetened, condensed, long-life, flavoured (e.g. chocolate, banana), non-dairy milk (e.g. almond, soya, rice).
  • Eggs.
  • Baby food: powdered, dry and/or liquid food intended for consumption by children.

Snacks such as crisps, nuts, sweets, chocolate and ice cream are excluded.

  • Children’s diapers.
  • Adult incontinence products.
  • Menstrual hygiene materials (tampons, sanitary towels and incontinence pads).

It should be clarified that, under the VAT legislation, businesses are obliged to draft an inventory of the products concerned.

These measures are temporary and will apply from the date of publication of the decree in the Official Journal of the Republic until October 31, 2023.

Currently, consumers pay 5% VAT when they buy bread, milk, baby food, eggs and sanitary napkins. When they buy baby and adult diapers, the VAT is as high as 19%.

Read more:

As of Friday, seven basic everyday goods should be sold at a zero VAT rate

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