On the day it adopted a package of infringement decisions due to the failure of Member States to communicate the measures taken to transpose certain European Union (EU) directives into national law, the Community executive immediately announced proceedings against Portugal (and six other countries, such as Belgium, Bulgaria, Greece, Spain, Lithuania and Romania), as it has not done so in relation to the law for Value Added Tax (VAT) rates.

The directive in question allows for the wider use by countries of reduced VAT rates, including the use of zero rates for essential products (such as food, pharmaceuticals and products intended for medical use), as well as specific rates as derogations to ensure equality. treatment throughout the Union.

As Portugal and these six countries have not communicated the complete transposition of this directive into national law by 31 December 2024, the European Commission is sending letters of formal notice giving them two months to respond, complete the transposition and notify their respective national measures.

In the absence of a satisfactory response, the Community executive may decide to issue a reasoned opinion and then take legal action.

Also today, Brussels sent letters to Portugal and seven other countries (Bulgaria, Ireland, Greece, Spain, Cyprus, Lithuania and Romania) for failing to communicate the transposition of the special VAT regime for small businesses, which should also have been done by the end of last year.

This other law allows small businesses to sell goods and services without charging VAT and alleviates their obligations to comply with this tax, in particular for smaller companies established in another Member State.

Portugal and these seven countries must also respond to the European Commission in this area within two months.

The transposition of the directive on adjustments to the size criteria for micro, small, medium and large companies or groups has yet to be communicated to Brussels, which has led to a third procedure opened against Portugal, announced today.

Regarding this legislation – which changes the accounting directive that adjusts the size criteria of micro, small, medium and large companies or groups based on inflation –, it should have been adopted in Portuguese law (and in four other countries, such as Cyprus, Czech Republic, Spain and Malta) until December 24, 2024.

As this did not happen, a two-month deadline is now given to do so.