In a joint declaration attached to the political agreement for new options for reduced VAT rates, Bulgaria, Germany, Denmark, Lithuania and Estonia called on other EU states to show restraint in applying reduced rates, since they lead to reduction of the tax base, artificial redistribution of employment without new jobs creation, and increase the administrative burden. The signatories of the declaration will not use the new option for reduced VAT rates
The argument is old, as we are reminded by Jean Quatremer. It is mainly between Germany and France, mainly on restaurant services. The question about the effectiveness of the reduced VAT rates remains under discussion.