VAT rate reduction for cosmetic services

A regulation has been published reducing the VAT rate for cosmetic services. The reduction is effective as of April 1, 2024. In connection with the change in the VAT rate, it may be necessary to determine the proper classification of the cosmetic services provided and reprogram the cash registers.

A reduced VAT rate of 8% is applied to hairdressing services in Poland. In the regulation on reduced VAT rates, the scope of this preference was expanded to include other services included in the so-called “beauty” sector, i.e. certain cosmetic services. Thus, both hairdressing and cosmetic services, classified in the PKWiU grouping 96.02.1, will be treated the same regarding VAT rates.

The scope of preferences in cosmetic services has been determined using the Polish Classification of Goods and Services (grouping PKWiU 96.02.1 Hairdressing and other cosmetic services) – see table.

A reduced rate of 8% was therefore applied to certain cosmetic procedures, such as beauty and facial treatments (which do not require specialized medical knowledge), manicures and pedicures, eyebrow and eyelash styling, ear piercing, related to beauty care counseling and makeup application, in personal hygiene, body care, depilation, ultraviolet and infrared radiation.

Not all services commonly recognized as cosmetic services are such according to the PKWiU classification. Such services are not, for example, invasive services such as tattooing or piercing services. Some of them are also classified as medical treatments, which – after meeting the requirements of the VAT Act – can enjoy exemption from this tax.

For this reason, it may be that some cosmetic establishments, in order to benefit from the 8% rate, will have to determine which of the treatments they provide can benefit from the 8% rate and which cannot. This can be done by applying for a Binding Rate Information (WIS). You also need to remember to change the VAT rate in the cash register.

egal basis

Decree of the Minister of Finance on March 14, 2024, amending the Decree on reduced rates of tax on goods and services – Journal of Laws of 2024, item 387
Ewa Slawinska
Lawyer, editor-in-chief of the “Accounting Monitor”.

Source: INFORLEX Companies and accounting offices publication in the INFORLEX series
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