Tax Committee: Simplified VAT regime for catering and retail to take effect from July 1

A presidential decree signed on May 26 grants enterprises in the catering, retail, and service sectors the right to voluntarily choose a simplified procedure for calculating and paying value-added tax (VAT). This option is available to all eligible businesses, excluding large taxpayers and enterprises where the state holds a share of 50% or more.

The incentive remains valid from June 1, 2026, until January 1, 2030. According to the Tax Committee, the transition to or withdrawal from the simplified framework takes effect on the first day of the month following the submission of a formal notification. Consequently, catering, trade, and service businesses can submit their requests starting June 1, meaning the new system will officially apply to those early applicants from July 1.

Under the simplified framework, businesses are exempted from corporate income tax and will instead pay a flat 6% VAT rate on the sale of goods and services. However, taxpayers operating under this regime cannot offset input VAT on purchases of goods and services, nor are they eligible for VAT cashbacks. Should a company decide to return to the standard taxation system, it will retain the right to offset VAT on the remaining balance of inventories and long-term assets listed on its balance sheet.

In addition to the simplified track, the presidential decree introduces a significant relief measure for catering establishments that choose to remain under the standard tax regime. These businesses can now receive a 40% VAT refund regardless of their share of cashless transactions. Previously, cafes and restaurants were required to generate at least 60% of their revenue through cashless payments to qualify for the 40% refund; otherwise, the refund rate was limited to 20%.