Andorra clarifies new VAT rates

Fri 8th Feb 2013

Andorra introduced a full EU-style VAT regime from the 1 January 2013. This included the new tax at 4.5%, replacing the old sales tax.

Reduced 0% and 1%, plus higher 9.5% VAT rates

It has recently clarified the supplies subject to the higher, 9.5% VAT rate. Most of these are financial services, which are generally exempt in European Union member countries.

The following supplies are subject to VAT of only 1%:

  • Basic foods
  • Newspapers and journals
  • Water

The following supplies are to be charged at 0%:

Public health and medicines

  • Education
  • Housing and rental
  • Cultural and sporting event admission