Macedonia: Macedonia introduces preferential VAT rate to pellet products

International Tax Review is part of Legal Benchmarking Limited, 4 Bouverie Street, London, EC4Y 8AX

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Macedonia: Macedonia introduces preferential VAT rate to pellet products

kostovska.jpg

Elena Kostovska

The latest addition to the list of preferential VAT goods and services that benefit from a 5% VAT rate was introduced on October 14 2016, and is effective from the same date. It prescribes the application of the reduced VAT rate to the supply of pellet fuel, pellet boilers and pellet stoves.

The preferential VAT rate is commonly applied to human food products, medicines and medical equipment, publications, seeds and planting material used in agriculture, other agricultural products such as fertilisers, foils and machinery, and software and hardware products, among others.

The decision to add pellet products to the list of preferential VAT goods was first announced in May 2016, along with the announced subsidisation of pellet stove purchases. The aim of both measures is to curb the still-common wood heating in the country. Depending on the methodology, it is estimated that anywhere between 35% and 80% of households in the country are still using wood as the primary heating element.

One obstacle that still needs to be removed is the delayed implementation of the application of the new VAT rate to imports of pellet products. As the customs authorities are still expecting the Ministry of Finance to issue the rulebook in regards to the amendment in order for them to apply the new rate, the previously valid standard rate of 18% continues to apply to the import of such products while their domestic resale must be done with the rate of 5%, thus creating a financially disadvantageous position for traders.

Elena Kostovska (elena.kostovska@eurofast.eu)

Eurofast Global, Skopje Office

Tel: +389 2 2400225

Website: www.eurofast.eu

more across site & shared bottom lb ros

More from across our site

Levine, who served under the Joe Biden administration, led the US’s negotiations on the OECD’s two-pillar solution
The deal to acquire ITR's parent company is expected to complete by the end of May 2025
JBS, the biggest meat company in the world, allegedly used Luxembourgian ‘mailbox companies’ to avoid taxes between 2019 and 2022
Despite the conviction of Jessa Dabalos, the Tax Practitioners’ Board’s investigative work continues with five outstanding PwC scandal probes
Heads of tax need to push their teams forward as strategic business advisers to add value across their organisations, says Sandy Markwick
Scott Bessent reportedly felt undermined by Musk naming Gary Shapley as acting IRS commissioner; in other news, Baker Tilly will combine with a top 15 US firm
The promise of nine years’ tax certainty and a ‘rational and pragmatic’ government process makes APAs a no-brainer, Indian tax advisers tell ITR
Despite garnering significant revenues from multinationals, Italy’s digital services tax presents pressing double taxation issues, say Stefano Simontacchi and Francesco Saverio Scandone of BonelliErede
ITR’s research shows that in-house tax counsel in Asia also feel underserved by their advisers’ international networks
World Tax global head of research Jon Moore tells ITR how his team spots standout submissions, and gives early statistical insights into this year’s entries
Gift this article