Ireland, Austria and Latvia cut VAT on food from July 2026

Ireland, Austria and Latvia cut VAT on food from 1 July 2026, with new rates of 9%, 4.9% and 12%. If you sell these goods to consumers in any of the three countries, the rate you charge at checkout has changed. Sales to businesses there are not affected.

What changed on 1 July 2026?

Ireland moved food, catering and hairdressing from 13.5% to 9%. Austria added a 4.9% rate for basic foods, which were taxed at 10%. Latvia cut bread, milk, poultry and eggs from 21% to 12% until 30 June 2027. Only the Latvian cut has an announced end date.

The Irish cut covers services as well as goods, so it matters to Irish cafés and salons as much as to anyone shipping food in. Full rates are on our pages for Ireland, Austria and Latvia.

What it means for you

These examples use a price before VAT, to show the size of the change.

Say you sell a €10.00 order of basic foods to an Austrian consumer through IOSS. In June you charged €10.00 × 10% = €1.00 VAT, so the customer paid €11.00. From 1 July you charge €10.00 × 4.9% = €0.49, so the customer pays €10.49.

If you keep the €11.00 price instead, the price before VAT becomes €11.00 ÷ 1.049 = €10.49. You keep about €0.49 more per order. Check that against what local competitors charge, as customers will expect prices to fall.

Who this affects

UK sellers of food to consumers in Ireland, Austria or Latvia are affected. Say you ship consignments worth up to €150 through the Import One Stop Shop (IOSS). You charge VAT at the customer's country rate for that product. Those lines need the new rate from 1 July.

Sales to businesses in these countries are not affected. Goods sent from Great Britain to an EU business are zero rated exports, and the customer pays import VAT in their own country.

Northern Ireland sellers of goods follow EU VAT rules for goods, so check how these rates apply to your EU sales.

The €3 duty started the same day

Separately, on 1 July 2026 the EU ended the €150 customs duty exemption for low-value parcels. A flat €3 customs duty now applies per item, meaning per tariff line, on low-value e-commerce consignments. IOSS does not cover it, because it is customs duty, not VAT. Our EU low-value imports guide explains how the €3 is counted and who pays.

What to do now

• Update checkout tax settings for each affected product and country. Make sure food lines are mapped to the right product category.
• Check your IOSS return. Sales from 1 July go in at the new rates. Sales before that date stay at the old ones.
• Diary the Latvian end date. The 12% rate ends on 30 June 2027 unless Latvia extends it.
• Recheck your product classifications, now that duty depends on tariff lines too.

What has not changed

• B2B exports. Goods from Great Britain to EU businesses are still zero rated.
• The IOSS limit. IOSS still covers consignments up to €150.
• Earlier sales. Anything sold before 1 July 2026 stays at the old rate.
• UK VAT. Your sales to UK customers are untouched by these cuts.

Source

Ireland's rates are on Revenue's current VAT rates page. For all three countries, see the European Commission's Taxes in Europe Database. Current rates for every member state are in our EU VAT rates table. Our guide to EU VAT for UK businesses covers IOSS and B2B sales.