EU VAT Rates by Product Category 2026: Food, Books, Digital & Medicine

Why product category matters more than country

Most VAT calculators ask one question: what country? That is only half the answer. EU law lets each member state apply up to two reduced rates (minimum 5%), one super-reduced rate (below 5%), and one zero rate to specific product categories listed in Annex III of the VAT Directive. The categories a country chooses — and the exact rates it sets — differ substantially.

Food is the clearest example. Ireland zero-rates most food. Germany charges 7%. Denmark charges the full 25% standard rate. If you sell food across the EU and use the standard rate everywhere, you are overcharging in some countries and undercharging in others.

This guide covers five categories that account for the majority of reduced-rate transactions: food and non-alcoholic beverages, books and e-books, digital services (SaaS, streaming, cloud), medicines and pharmaceutical products, and children’s clothing and footwear. Rates are sourced from the European Commission’s Taxes in Europe Database (TEDB), national tax authority publications, and the EU VAT Directive Annex III as amended by Council Directive (EU) 2022/542, last verified October 2026.

Before you rely on any figure here, understand the legal framework. The standard VAT rate must be at least 15% across the EU (Article 110 of the VAT Directive). Reduced rates must be at least 5% (Article 111). Super-reduced rates below 5% and zero rates with input deduction are permitted only for the seven categories listed in Article 112, which include basic food, pharmaceuticals, children’s clothing and cultural services. A country cannot simply pick any rate for any product — the product must appear in Annex III.

Food and non-alcoholic beverages

Food carries the widest variation of any category. Some countries use a single reduced rate; others apply two or three tiers depending on the product. Restaurant meals are almost always taxed at a higher rate than packaged food, and alcohol is taxed at the standard rate everywhere in the EU.

Key takeaway: Denmark is the only EU country with no reduced food rate. Ireland, Spain and Poland zero-rate basic staples. Austria introduced a new 4.9% rate on listed staple foods from 1 July 2026. Finland lowered its food rate from 14% to 13.5% on 1 January 2026. If you sell food cross-border, the rate you charge can vary from 0% to 25% depending on the customer’s country. Always check whether sugary drinks, alcohol and tobacco are excluded from the reduced rate — they usually are.

Books, e-books and digital publications

Since a 2015 European Court of Justice ruling (Commission v Hungary, Case C-263/14), EU countries are permitted — but not required — to apply the same reduced rate to e-books as to physical books. Most major markets have aligned their digital rates. Denmark is the notable exception, charging the full standard rate on both formats.

Annex III point 6 of the VAT Directive explicitly covers books, newspapers and periodicals “on physical means of support or supplied electronically.” This means a country that chooses to reduce the rate on printed books must also reduce it on e-books — but only if it exercises its option under Annex III. Countries that have not transposed this point into national law may still charge different rates.

Key takeaway: If you sell e-books or digital publications, 24 of 27 EU countries apply a reduced rate. Ireland is the outlier: physical books are 0% but e-books are 9% (the rate was harmonised upward, not downward). Denmark charges 25% on everything. France applies a super-reduced 2.1% rate to registered press publications. Finland lowered its book rate from 14% to 13.5% on 1 January 2026, while newspapers stay at 10%.

Digital services (SaaS, software, streaming)

Digitally supplied services (ESS) — SaaS subscriptions, streaming, cloud hosting, online courses, digital advertising — are charged at the standard rate in virtually all EU countries. The only exception is e-books and digital press, which many countries tax at the reduced book rate (see above).

The legal definition comes from Article 7 of Council Implementing Regulation (EU) No 282/2011: an ESS is delivered over the internet, is substantially automated with minimal human intervention, and cannot be provided without information technology. Article 58 of the VAT Directive sets the place of supply: for B2C digital services, VAT is due in the customer’s country.

For EU-established sellers, the €10,000 pan-EU threshold applies (Council Directive (EU) 2017/2455). Below that combined cross-border figure, you may charge your home country’s rate. Above it, you must charge each customer’s local rate. Non-EU sellers have no threshold — destination rates apply from the first euro. See the distance selling thresholds guide for the full rules.

Key takeaway: SaaS and streaming always use the standard rate (17–27%). E-books get a reduced rate in 24 of 27 countries. If you sell both, you need two rate sets per country. Use the VAT calculator with Custom rate mode for e-book rates, and the standard country preset for SaaS rates.

Medicines and pharmaceutical products

Medicine rates vary the most of any category, from 0% to 19%. Super-reduced rates (below 5%) exist in several countries specifically for reimbursable medicines and medical devices. Annex III points 3 and 4 of the VAT Directive permit member states to apply rates below 5% or zero rates with input deduction for pharmaceutical products and medical equipment.

Key takeaway: France applies a 2.1% super-reduced rate to social-security-reimbursable medicines — the lowest positive VAT rate in the EU. Ireland zero-rates oral medicines. Germany charges the full 19% on most medicines (only certain medical devices get 7%). The classification of a pharmaceutical product depends on its marketing authorisation status, not just its CN code, so confirm with the national authority for borderline products.

Children’s clothing and footwear

Annex III point 24 of the VAT Directive covers children’s clothing, footwear and car seats. Only two EU countries currently apply a reduced rate to this category:

• Ireland: 0% — children’s clothing and footwear for children under 11
• Luxembourg: 3% — children’s clothing for children up to 13

All other EU countries apply the standard rate (21–27%) on children’s clothing. If you sell children’s apparel cross-border, the VAT rate can differ by more than 20 percentage points depending on the destination. This is one of the most under-known reduced-rate variations in the EU.

How to find the correct rate for your product

1. Classify the product: Find the 8-digit CN (Combined Nomenclature) code from your customs data or supplier documentation. The CN code determines which Annex III category the product falls under.
2. Check Annex III of the VAT Directive: The product must fall within one of the 32 listed categories for a reduced rate to be available. If it is not listed, the standard rate applies.
3. Search the TEDB database: The European Commission’s Taxes in Europe Database lists every country’s rates by category, with conditions, exclusions and derogations. It is the authoritative source for reduced-rate scope.
4. Confirm with the national authority: For borderline products, request a binding ruling from the relevant tax office. TEDB data is provided by member states and may not capture every national nuance.
5. Use the calculator: Once you have the rate, use the EU VAT calculator with Custom rate mode to compute net, VAT and gross for any amount and currency.

What this means for cross-border sellers

If you sell B2C to EU consumers and your cross-border turnover exceeds €10,000, you must charge the destination country’s rate for the specific product category. This creates real complexity when your catalogue spans multiple categories:

• A French e-book seller charges 5.5% to French customers, 4% to Spanish customers, and 0% to Irish customers — all for the same digital download.
• A German SaaS company charges 19% to German customers, 27% to Hungarian customers, and 17% to Luxembourg customers — for an identical subscription.
• A Dutch food company charges 9% to Dutch customers but 0% to Irish customers on basic food — a 9-point margin difference.
• A Polish children’s clothing seller charges 23% to Polish customers but 0% to Irish customers on qualifying items.

The reverse charge / OSS checker helps you determine which regime applies to your specific transaction (B2B reverse charge vs B2C OSS vs domestic). The VAT calculator computes the exact amounts once you have the rate. For registration rules, see the OSS vs IOSS comparison guide.

Sources

European Commission, Taxes in Europe Database (TEDB), data as at 1 July 2026. Council Directive 2006/112/EC, Articles 110–112 and Annex III (list of goods and services eligible for reduced rates), as amended by Council Directive (EU) 2022/542. Commission Implementing Regulation (EU) No 282/2011, Article 7 (definition of electronically supplied services). Council Directive (EU) 2017/2455 (OSS €10,000 threshold). Case C-263/14, Commission v Hungary (e-books, 5 October 2015). National tax authority publications: Agencia Tributaria (Spain), Bundeszentralamt für Steuern (Germany), Direction générale des Finances publiques (France), Agenzia delle Entrate (Italy), Vero (Finland), Verwaltung (Austria). Rates change; verify with your national authority before filing.

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