COVID-19 : Temporary VAT benefits for masks and other protective equipment

08 May 2020

In the fight against COVID-19 virus, masks and other protective equipment temporarily benefit from VAT advantages. Firstly, a reduced VAT rate is introduced on certain products. In addition, from now on, certain goods can be imported into Belgium exempt from customs duties and VAT.  What do you need to know about this?

Reduced VAT of 6% on masks and hand sanitizers.

What's it about ?

Normally, the sale of masks and hand sanitizers is subject to the standard VAT rate of 21%. As part of the fight against the COVID-19 virus, the supply, intra-Community acquisition and importation of such products are, as from 4 May 2020, subject to the reduced VAT rate of 6%.

The Royal decree reducing the VAT rate was published on 7 May 2020.

Who can benefit from the reduced rate ?

The reduced VAT rate applies to all BCB, B2C and B2G transactions. Therefore, it does not matter in which capacity you buy the goods.  

Temporary measure 

This is a temporary measure: the reduced rate will apply until 31 December 2020

Which goods are eligible ?

The lowered VAT rate is limited to: 

  • Masks with the following Combined Nomenclature  codes 4818 90 10 00, 4818 90 90 00, 6307 90 98 10, 6307 90 98 91, 6307 90 98 99 en 9020 00 00 10 ; and

  • hydroalcoholic gels.

Importations exempt from customs duties and VAT 

What's it about ?

Whenever goods are transported from a third country or, in other words, a country that is not a member of the European Union (for example South Korea or Switzerland), to Belgium  an import occurs, causing, both VAT and customs duties to become due (Articles 23 and 24 of the Belgian VAT Code and Article 77 of the Union Customs Code).

Customs duties should in principle be paid by all individuals or entities declaring the importation of goods into the European Union (Article 1, 4°, a), 1° of the General Law on Customs and Excises of 18 July 1977). Likewise, VAT on import is not limited to individuals and entities subject to VAT with a right to deduct VAT. VAT payers without the right to deduct, such as hospitals, and non-taxable legal persons, such as public bodies, also have to pay VAT on the goods they import into Belgium from a third country (Art. 3 of the VAT Code).

In order to combat the COVID-19 virus, certain goods can now, under certain conditions, be imported into Belgium exempt from VAT and customs duties (Circular 2020/C/54 of 17 April 2020). 

This is a temporary measure. The exemption from VAT and customs duties applies to all goods imported up to and including 31 July 2020. This is a full and definitive exemption.

Who can benefit from the exemption ?

Not everyone can benefit from the exemption. The exemption only applies to:

  • public institutions and other bodies governed by public law (e.g. FPS Public Health, regions, provinces, cities and municipalities, etc.);

  • humanitarian aid organisations;

  • charitable or philanthropic organisations recognised by the General Administration of Customs and Excise to be allowed to import certain goods into Belgian territory exempt from VAT and import duties.

The above-mentioned entities will only be able to benefit from the VAT exemption if the imported goods are used entirely free of charge for the fight against the COVID-19 virus.

Which goods are eligible ?

The goods must be necessary for the fight against the COVID-19 virus.

Firstly it relates to  medical devices and devices intended for clinical research, e.g. laboratory equipment, examination and collection kits, infusion pumps for drugs, reagents, thermometers, etc., which must be used for the control of the COVID-19 virus.

Protective equipment is also included, e.g. mouth masks, protective clothing, soaps and hand sanitizers, safety glasses, shoe covers, gloves, etc.

Finally, medicines are also included.

Formalities

In order to benefit from the exemption, it is not required to have an individual licence.

However, you must list your EORI number on the Single Administrative Document. If you do not have an EORI number, you can use the EORI number created specifically for these imports, i.e. BECOVID19. 

If you have any further questions, please do not hesitate to contact Tim Van Sant. 

 

Contact us

Tim Van Sant

Tim Van Sant

Advocaat Vennoot / Avocat Associé, PwC Legal BV/SRL

Tel: +32 470 77 57 18

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