Press Release: VAT: The European Commission requests Portugal to modify its flat-rate scheme applied to farmers

On 25 June, 2009, the European Commission formally requested Portugal to change its law since it was of the opinion that Portugal does not apply a flat rate scheme for farmers consistent with the objectives of the scheme which is laid down in the VAT Directive. As a result farmers opting for the flat rate scheme may face financial disadvantages. The request took the form of a reasoned opinion (second step of the infringement procedure provided for in article 226 of the EC Treaty). If the relevant national legislation is not amended in order to comply with the respective reasoned opinion, the Commission may decide to refer the matter to the European Court of Justice.