New law clarifies 6% VAT rules for urban rehabilitation since 2009

The new law establishing rules for the application of the 6% VAT in urban rehabilitation was published this Monday in the Diário da República. This legislation is retroactive to 2009, according to the approved regulations.

The new regulations apply to renovation projects in urban rehabilitation areas (ARA), even in the absence of a rehabilitation operation (RO). According to the new law, all contracts made in these areas must benefit from the reduced VAT rate of 6%.

The adoption of this legislation aims to resolve situations that occurred between 2009 and 2013, where builders did not apply the reduced VAT rate. Thus, it is expected that projects carried out during this period will now be regularized.

The new law comes into effect this Tuesday, August 18, and aims to prevent the penalization of projects due to the incorrect application of the VAT rate. This legal framework seeks to provide greater clarity and security for stakeholders in the sector.

The publication of the law has been widely discussed by various sources, who highlighted the importance of clarifying VAT rules in urban rehabilitation. According to available information, this measure aims to facilitate urban renewal in several locations.

The legislation was described as a necessary response to the challenges that arose in the past, where the lack of clear guidelines resulted in issues for entrepreneurs and builders.