The European Council recently announced a significant agreement to update EU value added tax rules to fit the digital age, with the aim of fighting tax fraud and supporting the digitalisation of businesses.
A legislative package has been developed that introduces new rules on electronic invoicing and data communication, with particular attention to activities carried out via digital platforms.New digital VAT obligations
By 2030, all VAT reporting obligations for cross-border transactions will have to be fully digitalized. This step will have a significant impact on online platforms, which will be required to pay VAT for short-term accommodation and passenger transport services in most cases where individual service providers do not charge VAT. This change is intended to ensure greater fairness between different service providers and prevent losses of tax revenue.
In addition, there will be an expansion and improvement of the online one-stop shops, further simplifying the VAT declaration process for businesses operating cross-border. This measure is part of a long-term commitment to promote a more inclusive and efficient economic environment in the EU.
Interoperability of electronic invoices
Another key element of the agreement is the introduction of a real-time digital declaration system through electronic invoices. The aim is to have an EU system in place by 2030, with the addition of a crucial requirement: all existing national systems will have to become interoperable by 2035. This step will ensure greater harmonization between the different EU member states and make it easier to manage international transactions.
Improvements in the interoperability of electronic invoicing systems are set to further reduce the risks of tax fraud and encourage greater transparency among businesses operating in the Single Market. These changes are a practical response to the growing need to adapt tax legislation to new economic and technological realities.
Article published on November 10, 2024 - 06:08
