The Council adopted on 5 May 2009 a Directive allowing - on a permanent basis - the optional use of reduced rates of VAT for certain labour-intensive local services, for which there is no risk of unfair competition between service providers in different Member States.
Examples include minor repair services (bicycles, shoes and leather goods, clothing and household) and renovation services (private dwellings), certain cleaning and domestic care services, hairdressing and restaurant and catering services.
The Directive will enter into force on the first day of the month following that of its publication in the Official Journal.
For further information is available from the Council press release here