What You Need to Know About Global VAT Rates in 2023

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 (%)
Albania20
Algeria19
Angola14
Argentina21
Armenia20
Australia10 
Austria20
Azerbaijan18
Bahrain5
Barbados17.5
Belarus20
Belgium21
BermudaThere is no VAT or sales tax in Bermuda.
Bolivia13
Bosnia & Herzegovina17
Botswana12
Brazil10 – 15 approx (Federal VAT) & 18 -20 approx (State Sales & Service Tax)
Bulgaria20
Cabo Verde15
Cambodia15
Cameroon19.5
Canada5 – 15 approx (Federal & Territorial sales taxes combined)
Cayman IslandsN/A
Chad18
Chile19
China13, 9, or 6. Goods dependant.
Columbia19
Congo18.90 (18% VAT & 5% surtax)
Costa Rica13
Croatia25
Cyprus19
Czech 21
Denmark25
Dominican 18
Ecuador12
Egypt14
El Salvador13
Equatorial Guinea15
Estonia20
Fiji9
Finland24
Guatemala12
France20
Gabon18
Georgia18
Germany19
Ghana12.5
GibraltarN/A
Greece24
GreenlandN/A
GuernseyN/A
Guyana14
Honduras15 (Sales Tax)
Hong Kong SARN/A
Jordan16 (Sales Tax)
Kazakhstan12
Hungary27
Iceland24
India5 -28 (Goods & Services Dependant). General rate of tax is 18%
Indonesia10
IraqN/A
Ireland23
Isle of Man20
Israel17
Italy22
Ivory Coast18
Jamaica16.5 (General Consumption Tax)
Japan8 (Consumption Tax)
Jersey5 (Goods & Services Tax)
Kenya16
Korea10
Kosovo18
KuwaitN/A
Kyrgyzstan12
Loa PDR10
Latvia21
LibyaN/A
Lebanon11
Liechtenstein7.7
Lithuania21
Luxembourg17
Macau SARN/A
Madagascar20
Malawi16.5
Malaysia10 (Sales Tax) 6 (Service Tax)
Malta18
Mauritius15
Mexico16
Moldova20
Mongolia10
Montenegro21
Morocco20
Mozambique17
Myanmar5 (Commercial Tax, General Rate)
Namibia15
Netherlands21
New Zealand15 (Goods & Services Tax)
Nicaragua15
Nigeria7.5
North Macedonia18
Norway25
OmanN/A
Pakistan17
Palestinian Territories16
Panama7 (Moveable Goods & Services Transfer Tax)
Papua New Guinea10 (Goods & Services Tax)
Paraguay10
Peru18
Philippines12
Poland23
Portugal23
Puerto RicoSales & Use Tax (11.5% for tangible personal property/certain services. B2B services & designated services – 4%)
QatarN/A
Russian 20
Rwanda18
Saint Lucia12.5
Saudi Arabia5
Senegal18
Serbia20
Singapore7 (Goods & Services Tax)
Slovak Republic20
Slovenia22
South Africa15
Spain21
Sri Lanka8
Swaziland15
Sweden25
Switzerland7.7
Taiwan5
Tajikistan18
Tanzania18
Thailand7
Timor-Leste2.5 (Sales Tax on Imported Goods)
Trinidad & Tobago12.5
Tunisia19
Turkey18
Turkmenistan15
Turks & Caicos IslandsN/A
Uganda18
Ukraine20
United Arab Emirates5
United Kingdom20
United StatesN/A
Uruguay22 (10 for certain goods and services)
Uzbekistan15
Venezuela16
Vietnam10
Zambia16
Zimbabwe14.5

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!

Leave a Comment