Value-added tax (VAT) is an indirect tax that is applied to the sale of goods and services. It’s a type of consumption tax, which means it’s paid by the consumer when they purchase something. This can be confusing for business owners who need to understand how VAT affects their operations, especially if their business operates in multiple countries. To help make sense of the global VAT landscape, let’s take a look at what you need to know about global VAT rates in 2023.
Which Countries Have Different Rates?
Every country has its own unique set of regulations surrounding value-added taxes (VAT). In Europe, for example, there are 28 countries that have implemented some form of VAT system with varying rates from 0% – 27%. Other countries around the world also have different rates; for instance, India has one standard rate across all regions while China has five different tiers depending on what type of goods or services are being sold. It’s important for businesses operating globally to understand these differences before entering new markets so they can accurately collect and pay taxes accordingly.
A-Z List of Global VAT Rates
| Territory (A-Z) | Standard Rate of VAT Consumption Tax (%) |
| Albania | 20 |
| Algeria | 19 |
| Angola | 14 |
| Argentina | 21 |
| Armenia | 20 |
| Australia | 10 |
| Austria | 20 |
| Azerbaijan | 18 |
| Bahrain | 5 |
| Barbados | 17.5 |
| Belarus | 20 |
| Belgium | 21 |
| Bermuda | There is no VAT or sales tax in Bermuda. |
| Bolivia | 13 |
| Bosnia & Herzegovina | 17 |
| Botswana | 12 |
| Brazil | 10 – 15 approx (Federal VAT) & 18 -20 approx (State Sales & Service Tax) |
| Bulgaria | 20 |
| Cabo Verde | 15 |
| Cambodia | 15 |
| Cameroon | 19.5 |
| Canada | 5 – 15 approx (Federal & Territorial sales taxes combined) |
| Cayman Islands | N/A |
| Chad | 18 |
| Chile | 19 |
| China | 13, 9, or 6. Goods dependant. |
| Columbia | 19 |
| Congo | 18.90 (18% VAT & 5% surtax) |
| Costa Rica | 13 |
| Croatia | 25 |
| Cyprus | 19 |
| Czech | 21 |
| Denmark | 25 |
| Dominican | 18 |
| Ecuador | 12 |
| Egypt | 14 |
| El Salvador | 13 |
| Equatorial Guinea | 15 |
| Estonia | 20 |
| Fiji | 9 |
| Finland | 24 |
| Guatemala | 12 |
| France | 20 |
| Gabon | 18 |
| Georgia | 18 |
| Germany | 19 |
| Ghana | 12.5 |
| Gibraltar | N/A |
| Greece | 24 |
| Greenland | N/A |
| Guernsey | N/A |
| Guyana | 14 |
| Honduras | 15 (Sales Tax) |
| Hong Kong SAR | N/A |
| Jordan | 16 (Sales Tax) |
| Kazakhstan | 12 |
| Hungary | 27 |
| Iceland | 24 |
| India | 5 -28 (Goods & Services Dependant). General rate of tax is 18% |
| Indonesia | 10 |
| Iraq | N/A |
| Ireland | 23 |
| Isle of Man | 20 |
| Israel | 17 |
| Italy | 22 |
| Ivory Coast | 18 |
| Jamaica | 16.5 (General Consumption Tax) |
| Japan | 8 (Consumption Tax) |
| Jersey | 5 (Goods & Services Tax) |
| Kenya | 16 |
| Korea | 10 |
| Kosovo | 18 |
| Kuwait | N/A |
| Kyrgyzstan | 12 |
| Loa PDR | 10 |
| Latvia | 21 |
| Libya | N/A |
| Lebanon | 11 |
| Liechtenstein | 7.7 |
| Lithuania | 21 |
| Luxembourg | 17 |
| Macau SAR | N/A |
| Madagascar | 20 |
| Malawi | 16.5 |
| Malaysia | 10 (Sales Tax) 6 (Service Tax) |
| Malta | 18 |
| Mauritius | 15 |
| Mexico | 16 |
| Moldova | 20 |
| Mongolia | 10 |
| Montenegro | 21 |
| Morocco | 20 |
| Mozambique | 17 |
| Myanmar | 5 (Commercial Tax, General Rate) |
| Namibia | 15 |
| Netherlands | 21 |
| New Zealand | 15 (Goods & Services Tax) |
| Nicaragua | 15 |
| Nigeria | 7.5 |
| North Macedonia | 18 |
| Norway | 25 |
| Oman | N/A |
| Pakistan | 17 |
| Palestinian Territories | 16 |
| Panama | 7 (Moveable Goods & Services Transfer Tax) |
| Papua New Guinea | 10 (Goods & Services Tax) |
| Paraguay | 10 |
| Peru | 18 |
| Philippines | 12 |
| Poland | 23 |
| Portugal | 23 |
| Puerto Rico | Sales & Use Tax (11.5% for tangible personal property/certain services. B2B services & designated services – 4%) |
| Qatar | N/A |
| Russian | 20 |
| Rwanda | 18 |
| Saint Lucia | 12.5 |
| Saudi Arabia | 5 |
| Senegal | 18 |
| Serbia | 20 |
| Singapore | 7 (Goods & Services Tax) |
| Slovak Republic | 20 |
| Slovenia | 22 |
| South Africa | 15 |
| Spain | 21 |
| Sri Lanka | 8 |
| Swaziland | 15 |
| Sweden | 25 |
| Switzerland | 7.7 |
| Taiwan | 5 |
| Tajikistan | 18 |
| Tanzania | 18 |
| Thailand | 7 |
| Timor-Leste | 2.5 (Sales Tax on Imported Goods) |
| Trinidad & Tobago | 12.5 |
| Tunisia | 19 |
| Turkey | 18 |
| Turkmenistan | 15 |
| Turks & Caicos Islands | N/A |
| Uganda | 18 |
| Ukraine | 20 |
| United Arab Emirates | 5 |
| United Kingdom | 20 |
| United States | N/A |
| Uruguay | 22 (10 for certain goods and services) |
| Uzbekistan | 15 |
| Venezuela | 16 |
| Vietnam | 10 |
| Zambia | 16 |
| Zimbabwe | 14.5 |
How Are Global Rates Changing?
In 2021, many countries increased their value-added taxes due to economic hardships caused by COVID-19. Unfortunately, this trend will likely continue into 2022 as governments grapple with budget deficits caused by pandemic-related expenses. Businesses should keep an eye on changes throughout 2021 as well as any potential shifts in 2022 so they can plan accordingly and adjust prices if necessary.
It’s also important to note that some countries have reduced or eliminated value-added taxes altogether; for instance, Canada recently introduced a zero percent rate on digital products such as music downloads or streaming subscriptions in order to stimulate online spending during lockdowns imposed by COVID-19 restrictions.
Conclusion:
Keeping up with global value-added tax (VAT) rates can be tricky for businesses operating internationally—especially when those rates change from year to year due to economic factors like COVID-19-related expenses. Knowing which countries have different rates and how those rates are changing over time can help businesses ensure they stay compliant with local regulations and remain competitive in their markets moving forward into 2022 and beyond!
Muzamil Hussain is a software developer and finance expert with over 5 years of experience in creating VAT calculators. He has worked on a variety of projects, from developing customized solutions for large corporations to helping small businesses automate their financial processes. He has a passion for using cutting-edge technologies to create tools that make life simpler and easier, and his VAT calculators are designed with this goal in mind.