(October 30, 2014)
On October 30, 2014, the European Commission published ideas on how to ensure a simpler, more effective and more fraud-proof VAT system.
Today the European Commission published a Commission Staff Working Document in which ideas on how to ensure a simpler, more effective and more fraud-proof VAT system tailored to the Single Market in the EU have been outlined. According to the European Commission, the aim is to create a “definitive VAT regime” to replace the current VAT system. The European Commission wants the future VAT regime to better meet the needs of businesses in the Single Market and be less susceptible to fraud than today’s system is. The Commission Staff Working Document that was published today sets out what the European Commission considers to be 5 feasible options. The five options are:
- Option 1: Taxation of intra-EU supplies where the goods are delivered;
- Option 2: Taxation of intra-EU supplies where the customer is established regardless of the place of delivery of the goods;
- Option 3: Reverse charge where the customer is established;
- Option 4: Reverse charge where the goods are delivered;
- Option 5: Status quo with some simplification of the procedures.
The Commission is now undertaking an in-depth assessment to determine the impact of each of the options for businesses and for Member States. On the basis of its findings, it will present the possible way forward in Spring 2015.
Click here to be forwarded to the Commission Staff Working Document as published on the website of the European Commission, which will open in a new window.
For further information click here to be forwarded to a press release that the European Commission has issued in this respect.
Click here to be forwarded to Memo/14/607 titled: “Reform of the VAT system: Frequently asked questions” as published on the website of the European Commission, which will open in a new window.
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