The European Commission has adopted a proposal that an exemption from VAT and excise duties should be included in the VAT Directive concerning supplies made to armed forces, when the forces are deployed in a European defence effort outside their member state.

This proposal is made in line with the EU’s Common Security and Defence Policy, and aims to amend the VAT Directive to include an exemption that would mirror the one currently in place for supplies made to forces engaged in NATO defence efforts. The revision would ensure equal treatment of supplies concerning defence efforts under the NATO and EU frameworks.

The Commission has opened a consultation inviting input concerning the proposed Directive, which will run until 9 June 2019. Further information concerning the consultation is available here.