Indirect Tax News - June 2021

Reduced VAT rate re-introduced for restaurant and catering services

With the (gradual) re-opening of bars, restaurants, etc., the Belgian Council of Ministers has decided to re-introduce the reduced VAT rate of 6% for restaurant, bar and catering services to support the sector.

The 6% rate (instead of 12%) will apply on a temporary basis to restaurant and catering services for the period 8 May 2021 through 30 September 2021. Newly added to the relief measures is that the supply of all beverages, including alcoholic beverages, for consumption on the premises will benefit from the 6% rate (instead of the standard VAT rate of 21%); the supply of alcoholic beverages without service/on-site consumption, remains subject to the 21% rate.

Although the term "restaurant and catering services" may suggest otherwise, the term covers the supply of drinks without a meal (provided it is accompanied by a sufficient degree of ancillary services) in any temporary or permanent venues for the sale of drinks (e.g., hotel bars, pubs, cafeterias and lunch messes, pop-up summer bars, etc.)

Pascal Dauw

Mazen Al Haffar