In line with the government's election promise restaurant services from the 1 of July will be reduced to 13% (in Continental Portugal). However there are a number of exceptions to this basic rule.
From the 1 of July 2016 VAT on restaurant services will be charged at 13% the intermediary rate. Previously the rate was 23%.
The reduction in the rate of VAT applies to food and beveridges consumed in the restaurant. Food and beveridges which are to be consumed outside the establishment would be subject to VAT at the rate which applies to the respective item.
For example if a client purchased milk and a pastry to be consumed at home the VAT charged would be 6 percent for the milk and 23 percent for the pastry as if they were purchasing the same items in a supermarket.
Equally the consumption of soft drinks including sparkling water,fruit juice and alcoholic drinks remains subject to VAT at 23 perecent even if it is consumed as part of a meal.