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Taxation and Customs Union

COVID-19: Waiving VAT and customs duties on vital medical equipment

Web Banner Covid-19 Taxud VAT and Duties

Commission waives customs duties and VAT on the import from non-EU countries of medical equipment for 23 EU Member States

Since the outbreak of the coronavirus pandemic in early 2020, the European Commission has supported all Member States with a series of decisions temporarily suspending customs duties and VAT on protective equipment, testing kits or medical devices such as ventilators. This made it financially easier to get the medical equipment that doctors, nurses and patients desperately need. While the initial measure applied for six months, the exemption was extended three times. 

A new decision which took effect on 1 January 2022 continues to suspend customs duties and VAT on these important products for imports to 23 EU Member States that expressed interest in prolonging the waiver once again. This waiver will continue to be applied until 30 June 2022. 

An indicative list of goods falling under the Commission decision is available here.

The list of Member States requesting the extension of the Commission Decision is available here.

Background Information

Current EU legislation has exceptional tools available in order to help victims of disasters, which can be used to face the unprecedented health crisis caused by coronavirus.

EU customs legislation (Council Regulation (EC) No 1186/2009 provides for the possibility to grant duty relief for the “benefit of disaster victims”. It can be applied to imports by State organisations or approved charitable or philanthropic organisations. To grant relief, a decision from the Commission is required, acting at the request of the Member States concerned.

Similarly, EU VAT law (Council Directive 2009/132/EC has mirroring provisions as regards exemption from VAT on the final importation of certain goods.

The duty and VAT free importation applies to:

  • State organisations (State bodies, public bodies and other bodies governed by public law including hospitals, governmental organisations, communes/towns, regional governments, etc.)
  • Charitable or philanthropic organisations approved by the competent authorities of the Member States

VAT relief for COVID-19 vaccines and COVID-19 testing kits

On 7 December 2020, EU Member States agreed important new measures enabling them to relieve EU hospitals, medical practitioners and individuals from Value-Added Tax (VAT) when acquiring coronavirus vaccines and testing kits. Based on a Commission proposal, the measure gives better and cheaper access to the tools needed to prevent and detect coronavirus.

The rules have allowed EU countries to put in place a temporary VAT exemption for COVID-19 vaccines and COVID-19 testing kits being sold to hospitals, doctors and individuals, as well as closely related services. Previously, Member States could apply reduced VAT rates on sales of vaccines but not a zero rate, while testing kits could not benefit from reduced rates. Under the amended Directive, Member States have been able to apply either reduced or zero rates to both vaccines and testing kits if they so choose.

The rules would remain in place until the end of 2022, or until an agreement was reached on the Commission's proposal for new rules on VAT rates, if the latter occurred earlier. Given that EU Finance Ministers reached agreement on that proposal on 7 December 2021, the specific rules allowing for VAT relief for COVID-19 vaccines and COVID-19 testing kits will cease to be applicable once the new rules on VAT rates come into force. This is expected to happen in Spring 2022.  

For more information