Brussels, 04/11/2009 (Agence Europe) - The European Commission has submitted to the EU Council of Ministers a draft decision to allow Estonia and Slovenia to continue to benefit from exemption from the EU VAT system.
In a decision taken by the EU Council of Ministers on 30 January 2007, Estonia and Slovenia were allowed to postpone the introduction of the right to VAT deductions until the time when the supplier of goods or services has actually been paid for the goods and services in question, as long as the supplier has an annual turnover of less than €208,646 a year in Slovenia, or is registered as an entrepreneur operating alone (for Estonia). Both member states therefore benefit from a simplified, optional cash accounting system under the VAT Directive (2006/112/EC, Article 66), making the VAT on business that has already taken place payable when the customer actually pays for the service or goods.
Last summer Estonia and Slovenia asked the Commission to extend the scheme. In addition, Slovenia asked for the annual upper limit to be raised to €400,000 in order to cut the administrative charges for a large number of small companies, while helping them improve their cashflow. In its proposal, the Commission agrees to all the requests. Once adopted by the Council, the decision will apply from 1 January 2010 until a directive comes into force to enable all member states to apply a similar system to Estonia and Slovenia.
The Commission foresees that the exemption granted to these two member states will apply until 31 December 2012 at the latest. The Commission's proposal can be found at: http: //eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM: 2009: 0608: FIN: FR: PDF. (O.L./transl.fl)