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EU to introduce VAT on financial services

The European Committee proposed to introduce VAT on financial services and insurance. Banks and insurance companies presently do not add the VAT to their services.

Once introduced, VAT would decrease public tax income on the short term, but the whole system would benefit from it on a longer term, according to László Kovács tax commissioner. The modifications aim at unifying the conditions in Europe. Presently, financial companies must add the VAT to their service prices in only five countries. The changes will probably not increase prices thanks to competition, added Kovács. (Napi Gazdaság)