Austria’s VAT System Explained: Rates, Registration, and Key Rules

Austria's VAT, known as Umsatzsteuer (USt), includes a standard rate of 20% and reduced rates of 10% and 13% for specific goods and services. Businesses must register if turnover exceeds EUR 55,000 and file returns quarterly or monthly. Certain exemptions apply, and no major changes to rates are expected through 2025, though product classifications may evolve.

In Austria, value-added tax is called Umsatzsteuer (USt). VAT is included in the price of goods and services. Businesses charge VAT on their sales and pay it to the tax authorities, while customers pay VAT as part of the final price.

Companies must determine the correct VAT rate, register when required, and submit VAT returns. Customers benefit from understanding how VAT influences pricing.

VAT rates in Austria (2025)

Austria applies the following VAT rates:

• 20% (standard rate) – applies to most goods and services,
• 13% (reduced rate) – applies to cultural events, certain tourism services, animal transport, firewood, and similar items,
• 10% (reduced rate) – applies to food, books, newspapers, medicines, residential rent, and public transport,
• 0% rate – applies mainly to exports and certain intra-EU transactions.

Two territorial exceptions, Jungholz and Mittelberg, apply a VAT rate of 19%.

VAT registration in Austria

• Austrian businesses must register for VAT once annual turnover exceeds approximately EUR 55,000.
• Foreign businesses often need to register from their first taxable transaction, especially when selling goods or services in Austria, storing goods there, or when the reverse-charge mechanism does not apply.

Obligations after registration

Once registered, businesses must file VAT returns:

• smaller businesses usually file quarterly,
• larger businesses file monthly.

Returns include output VAT (charged on sales) and input VAT (paid on purchases). The difference is either paid to the tax authority or refunded.

VAT on goods and services

Some activities are VAT-exempt, including:

• medical services,
• education,
• financial services,
• long-term residential rentals.

VAT-exempt businesses generally cannot deduct input VAT, which may affect costs and pricing.

Practical VAT examples

• Bread – 10%
• Electronics – 20%
• Passenger transport – 10%
• Concerts – often 13%
• Exports outside the EU – 0%

Correct classification of goods and services is essential.

No major VAT changes are expected in Austria by the end of 2025. The existing rates (10%, 13%, 20%, and 0%) remain in place. However, detailed product classifications may change, especially for e-commerce and cross-border activities.

Austria’s VAT system is structured but includes many exceptions. The standard rate is 20%, but reduced rates and exemptions apply depending on the type of supply. Businesses operating in Austria must ensure correct registration, classification, and reporting to remain compliant.