VAT in Austria (Umsatzsteuer)
Last updated: March 2026
As of March 2026, Austria applies three VAT rates: 20% standard rate on most goods and services, 13% on accommodation and cultural events, and 10% on essentials such as food, books, public transport, and residential rent. Businesses with annual net revenue below 35,000 EUR may qualify for the small business exemption (Kleinunternehmerregelung) and avoid charging VAT entirely.
What Does the Standard 20% VAT Rate Apply To?
The standard VAT rate in Austria is 20% (separate from income tax, which is withheld from salaries). It applies to the majority of goods and services, including electronics, clothing, furniture, professional services, and most retail items. When you see a price in an Austrian shop, VAT is already included (Brutto price). On invoices, businesses are required to show the net amount (Netto) and the VAT separately.
What Goods and Services Are Taxed at the Reduced 10% Rate?
A reduced rate of 10% applies to essential goods and services that are considered part of everyday life. These include:
- Basic foodstuffs (bread, milk, fruit, vegetables, meat)
- Books, newspapers, and magazines (print and digital)
- Public transport (buses, trams, trains, metro)
- Pharmaceutical products and medical devices
- Residential rent
- Waste collection and sewage services
What Is Taxed at the 13% VAT Rate in Austria?
The 13% rate applies to a specific set of goods and services that fall between the essential and standard categories:
- Accommodation (hotels, guesthouses, Airbnb)
- Admission to cultural events (concerts, theatre, museums)
- Admission to sporting events
- Live plants, flowers, and firewood
- Wine directly from the producer (Ab-Hof-Verkauf)
- Film screenings (cinema)
What Are All the VAT Rates in Austria at a Glance?
| Rate | Applies To |
|---|---|
| 20% | Most goods and services (electronics, clothing, restaurants, professional services) |
| 13% | Accommodation, cultural and sporting events, flowers, wine from producers |
| 10% | Food, books, public transport, medicine, residential rent |
| 0% | Intra-EU exports, international transport, certain financial and medical services |
How Does the Small Business VAT Exemption (Kleinunternehmerregelung) Work?
If your annual revenue does not exceed 35,000 EUR (net), you can opt for the small business exemption. Under this rule, you do not charge VAT on your invoices and do not need to file VAT returns. However, you also cannot claim input VAT (Vorsteuer) on your business purchases. This regime is particularly popular among freelancers and small businesses starting out in Austria. For official guidance, consult the BMF or WKO websites.
You can voluntarily opt into the standard VAT system if it benefits you, for instance, if your business expenses have significant VAT that you would like to reclaim. Once you opt in, you are bound for at least five years.
How Is VAT Applied to Food and Dining in Austria?
An important distinction: groceries bought in a supermarket are taxed at 10%, while food served in restaurants and cafes is taxed at 10% for the food itself but 20% for beverages (except non-alcoholic drinks which remain at 10%). Takeaway food is generally taxed at 10%. This split can appear confusing on restaurant receipts, where you may see both 10% and 20% VAT lines. For a full breakdown of everyday expenses, see our cost of living guide.