Slovakia raises VAT 1% to 20% in January 2011
Slovakia has agreed to follow the Czech Republic with a 1% VAT rate rise. It is trailed as a temporary measure, to be withdrawn at the start of 2012. The reduced VAT rate may be withdrawn.
The rate tracks the Czech rate, which rose from 19% to 20% on January 2010.
It is included as part of package of measures to help sure up the government’s deficit. As a future member of the Euro currency, the Slovak government must contain its deficit within 3% of GDP, which is a key criteria for the currency.