On 9 April, the Finance Ministers of the 27 EU Member States agreed on a package of measures valued €500 billion to deal with the COVID-19 pandemic and the subsequent socio-economic crisis. The package includes the access to a credit line of the European Stability Mechanism for Member States that intend to use this credit line “to support domestic financing of direct and indirect healthcare, cure and prevention related costs due to the COVID 19 crisis”. The credit line will not be subject to regular monitoring and would grant up to 2% of the respective Member’s 2019 GDP. There will also be a Recovery Fund to support economic recovery of the most affected Member States in line with European priorities. The decision on how to finance the Recovery Fund has been left to the European Council, which should also discuss “legal and practical aspects of such a fund, including its relation to the EU budget”. The Eurogroup has also endorsed the Commission’s proposal establishing the SURE (Support to mitigate Unemployment Risks in an Emergency) instrument to help finance national short-time working schemes and supported the initiative of the European Investment Bank to create a pan-European guarantee fund of €25 billion, which could support €200 billion of financing for companies with a focus on SMEs.
On 3 April, the European Commission has published a decision helping Member States affected by the coronavirus pandemic to temporarily suspend customs duties and VAT on protective equipment, testing kits or medical devices such as ventilators. The measure will apply for six months, with a possibility for a further extension. This decision will make it easier financially to get the medical equipment for doctors, nurses and patients. The Commission has also made available an indicative list of goods falling under the decision.
On 8 April, the VAT Committee has published an updated version of its VAT Guidelines. The VAT Committee was set as an advisory committee to promote the uniform application of the VAT Directive. It does not have any legislative power and cannot take legally binding decisions, but it gives some guidance on the application of the Directive. Therefore, the Guidelines do not constitute an official interpretation of EU law and do not bind the European Commission or the Member States who are free to not follow them.
