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Law360 (April 15, 2020, 12:00 PM EDT ) Austria will temporarily eliminate value-added tax on protective masks in an effort to make acquiring them as easy as possible for its citizens as the country slowly emerges from lockdown, the country's finance minister said.
In a statement published Tuesday, the Finance Ministry said that the VAT rate on such masks would be cut from 20% to zero. The measure takes effect from Apr. 13 and is valid until Aug. 1.
"Protective masks are a central health measure to prevent infection through droplets. Therefore, we have reduced the tax for delivery and purchase to 0% and are thus making the financial burden of the obligation to wear a mask as low as possible for citizens. Times of crises cannot be times of bureaucracy," explained the country's finance minister, Gernot Blümel, in a statement.
The announcement follows a decision taken two weeks ago by the European Commission, the European Union's executive, to waive temporarily value-added tax and tariffs on imported protective medical equipment. The Austrian Finance Ministry said its announcement wasn't related to the EU decision, as that dealt with items imported into the EU. Asked for comment, the commission declined to respond on the record.
Austria is one of the first European Union countries to start a gradual exit from drastic restrictions on movement that countries around the world have implemented in an effort to stop the spread of COVID-19, the deadly disease caused by the novel coronavirus. Starting Tuesday, the country allowed some stores that had been forced to close to stop the spread of the virus, such as garden centers, to reopen. The country intends to allow larger stores to reopen starting May 1.
To enable some semblance of normal life to return, the country is, however, requiring that citizens wear masks when they are in public spaces such as stores and public transit.
The EU on Wednesday published a loose plan to guide countries as they start to plan an exit from some of the strictest restrictions on movement seen in Europe since World War II. The so-called road map set no specific dates for changing policy but urged EU states to base their actions on public health considerations and coordinate actions with one another. The document made no reference to taxes or tax policies.
--Additional reporting by Matt Thompson. Editing by Vincent Sherry.
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