The EU Council has adopted a directive maintaining the minimum standard VAT rate at 15% for a further two years

The minimum standard rate is aimed at preventing an excessive divergence in VAT rates applied by different Member States, and the structural imbalances or distortions of competition that could arise as a result. In view of on-going discussions on definitive rules for a single European VAT area, the directive extends the minimum standard rate for a period long enough to ensure legal certainty. It maintains the rate at 15% from 1 January 2016 until 31 December 2017.

While this has no direct impact on the UK, as there is nothing to suggest that our standard rate of 20% is set to change, it does serve to highlight the wider VAT context within which current decisions are being taken.