VAT rates in Europe 2026: what they mean for car margins
VAT rates in Europe in 2026 for car dealers: standard rates by country, VAT due on a margin-scheme car and how to compare cross-border deals.
· 8 min read
Standard VAT rates in Europe in 2026 range from 17% in Luxembourg to 27% in Hungary; Germany charges 19%, France and Austria 20%, the Netherlands and Belgium 21%, Poland 23%. Cars pay the standard rate. Your own country's rate decides how much of each margin-scheme profit goes to the tax office – on a €2,000 margin, 17% versus 27% is about €135 per car.
VAT rates in Europe in 2026: the full table
Every EU member state taxes the sale of ordinary passenger cars at its standard rate; reduced rates exist only for narrow cases such as vehicles adapted for disabled drivers in some countries. The table below shows the standard rates in force in October 2026. No EU country changed its standard rate during 2026; the last changes were in 2024 and 2025.
| Country | Standard VAT rate | Recent change |
|---|---|---|
| Austria | 20% | |
| Belgium | 21% | |
| Bulgaria | 20% | |
| Croatia | 25% | |
| Cyprus | 19% | |
| Czech Republic | 21% | |
| Denmark | 25% | |
| Estonia | 24% | raised from 22% on 1 July 2025 |
| Finland | 25.5% | raised from 24% on 1 September 2024 |
| France | 20% | |
| Germany | 19% | |
| Greece | 24% | |
| Hungary | 27% | |
| Ireland | 23% | |
| Italy | 22% | |
| Latvia | 21% | |
| Lithuania | 21% | |
| Luxembourg | 17% | |
| Malta | 18% | |
| Netherlands | 21% | |
| Poland | 23% | |
| Portugal | 23% | mainland rate |
| Romania | 21% | raised from 19% on 1 August 2025 |
| Slovakia | 23% | raised from 20% on 1 January 2025 |
| Slovenia | 22% | |
| Spain | 21% | |
| Sweden | 25% |
Outside the EU, Norway charges 25%, Switzerland 8.1% and the United Kingdom 20%. Imports from these countries pay import VAT at the rate of the EU country of import. The VAT Directive 2006/112/EC requires a standard rate of at least 15% (Article 97), which is why the EU range is relatively narrow.
How the VAT rate changes the profit on a margin-scheme car
Under the margin scheme, VAT is calculated from the gross margin using the VAT fraction of your national rate: margin × rate ÷ (100 + rate). The higher your rate, the larger the share of every euro of margin that goes to the state.
VAT due on the same €2,000 gross margin:
| Dealer's country rate | VAT fraction | VAT on €2,000 margin | Net margin left |
|---|---|---|---|
| 17% (Luxembourg) | 17/117 | €290.60 | €1,709.40 |
| 19% (Germany) | 19/119 | €319.33 | €1,680.67 |
| 20% (Austria, France) | 20/120 | €333.33 | €1,666.67 |
| 21% (Netherlands, Belgium, Czech Republic) | 21/121 | €347.11 | €1,652.89 |
| 23% (Poland, Slovakia, Ireland) | 23/123 | €373.98 | €1,626.02 |
| 25% (Denmark, Sweden, Croatia) | 25/125 | €400.00 | €1,600.00 |
| 25.5% (Finland) | 25.5/125.5 | €406.37 | €1,593.63 |
| 27% (Hungary) | 27/127 | €425.20 | €1,574.80 |
The difference looks small per car, but it scales. A dealer selling 300 margin-scheme cars a year at a €2,000 average gross margin pays about €95,800 of VAT at 19% and about €112,200 at 23%. A dealer moving from Slovakia's old 20% to the current 23% lost roughly €40 of net margin per €2,000 car unless prices rose. For more examples, see the VAT margin scheme calculator.
For VAT-qualifying cars sold under normal VAT, the rate does not reduce your margin directly – you charge VAT on top of the net price and pass it on. But it changes the gross price the customer sees: the same €20,000 net car costs €23,800 in Germany and €24,600 in Poland.
For car dealers
Know your margin before you buy
MyCarDealer compares any car from an auction or listing with the market in your country and shows the net margin after VAT, transport and costs – and the maximum bid.
Request accessWhich VAT rate applies when selling a car to another EU country?
The rate depends on the buyer and the VAT scheme of the car, not on where the buyer is from alone. The main cases:
- To a VAT-registered dealer in another member state, VAT-qualifying car: exempt intra-Community supply (Article 138). You charge 0%, the buyer accounts for VAT at their own rate.
- Any buyer, margin-scheme car: your own rate on the margin. The margin scheme stays in the country of the seller.
- To a consumer abroad, VAT-qualifying car you deliver: the buyer's rate, as a distance sale (usually through the OSS).
- To a consumer who collects: your own rate on the full price.
- New means of transport (≤ 6 months or ≤ 6,000 km): exempt; the buyer pays VAT at home.
The details, including the €10,000 distance-selling threshold, are in our guide to selling used cars to EU consumers.
How to compare deals from countries with different VAT rates
Compare cross-border deals on a net basis, and only after you know which VAT scheme the car is in. Comparing asking prices across borders directly is misleading, because each country's price includes its own VAT and, in many countries, a registration tax.
The listing data shows how far apart gross prices are. According to listings tracked by MyCarDealer in October 2026, the median asking price of a 2019–2021 VW Golf was €16,900 in Germany (1,107 listings), €18,950 in Belgium (464 listings), €18,800 in Italy (317 listings) and €21,450 in the Netherlands (173 listings). The Dutch premium comes largely from BPM, the Dutch registration tax, rather than from VAT – the Netherlands and Belgium both charge 21%.
A simple comparison method:
- Identify the scheme. Margin-scheme car (price includes non-reclaimable VAT of the seller's country) or VAT-qualifying car (net price plus reclaimable VAT)?
- For VAT-qualifying cars, use the net price. A German car at €23,800 gross is €20,000 net; bought by a foreign dealer as an intra-Community supply, it costs €20,000.
- For margin-scheme cars, use the full price. The seller's VAT is baked in and you cannot reclaim it. You will also pay your own VAT on your margin when you resell.
- Add transport, registration tax and recon. Registration taxes such as BPM, NoVA or Polish excise often outweigh VAT differences; see car registration tax in Europe.
- Compare with your home market price and calculate net margin at your own rate.
VAT-qualifying versus margin-scheme stock across borders
For cross-border buying, VAT-qualifying cars are usually the better deal for a dealer in a high-VAT country. You buy net, reclaim nothing because nothing was charged, and charge your own VAT on resale – which the next business buyer can deduct. A margin-scheme car bought from a German dealer, by contrast, carries German VAT hidden in its price that nobody can recover.
That is why the same 3-year-old ex-lease car can be worth more to a Polish dealer when it is sold net (VAT-qualifying) than when it has been through a German private owner and is offered under the margin scheme. Our guide to VAT qualifying cars explains when paying more for a net car still pays off.
Practical tips for dealers working across rates
- Keep a current rate table in your pricing sheet and update it each January and July, when most changes take effect.
- Always calculate margin-scheme VAT at your own rate, never at the rate of the country where you bought the car.
- When a buyer abroad asks for a "net price", check first whether the car is VAT-qualifying – a margin-scheme car has no net price that a buyer can use.
- For each deal, work out the maximum you can pay from the expected sale price, your VAT on the margin, costs and target profit. MyCarDealer does this calculation at your country's rate for auction and listing cars; you can value one car free of charge.
Frequently asked questions
What are the VAT rates on cars in EU countries in 2026?
Ordinary passenger cars are taxed at the standard rate in every EU member state. In 2026 these range from 17% in Luxembourg to 27% in Hungary, with Germany at 19%, France and Austria at 20%, the Netherlands, Belgium and Spain at 21%, Italy at 22% and Poland at 23%.
How does the VAT rate change the profit on a margin-scheme car?
Margin-scheme VAT is calculated as margin × rate ÷ (100 + rate). On a €2,000 gross margin, a German dealer pays €319.33 at 19% and a Polish dealer €373.98 at 23%, so the Polish dealer keeps about €55 less from the same margin.
Which VAT rate applies when selling a car to another EU country?
A VAT-qualifying car sold to a dealer with a valid VAT number is exempt and taxed in the buyer's country. A margin-scheme car is taxed at the seller's rate on the margin. A VAT-qualifying car delivered to a consumer abroad is taxed at the buyer's rate.
How do I compare deals from countries with different VAT rates?
Compare VAT-qualifying cars on their net price and margin-scheme cars on their full price, because the seller's VAT in a margin-scheme price cannot be recovered. Then add transport and registration tax and compare with the price you can achieve at home.
Did any EU country change its VAT rate in 2026?
No EU country changed its standard rate in 2026. The most recent increases were Slovakia (23% from January 2025), Estonia (24% from July 2025) and Romania (21% from August 2025), with Finland at 25.5% since September 2024.