On Friday 25 May, the European Commission proposed detailed technical amendments to the EU rules on value-added tax (VAT). The aim is to make the system more resilient to fraud.
Around 200 of the 408 articles that make up the VAT directive will need to be modified so that businesses and national budgets can benefit from the following advantages: - simplification of the way in which goods are taxed (single taxable transaction, guaranteeing the taxation of goods in the member state in which the transport is concluded); - 'one-stop shop' for economic operators to fulfil VAT formalities; - less red tape (specific reporting obligations linked to the transitional VAT regime will become redundant for trade in goods and subsequent invoicing for trade within the EU will be governed by the rules of the member state of the vendor); - the vendor is generally liable for collecting VAT (it is the responsibility of the vendor to invoice for VAT due on a sale of goods to its customer located in another EU country, at the rate applicable in the member state of destination. The purchaser of the goods will be liable for VAT only if the customer is a Certified Taxable Person).
In October of last year, the Commission proposed the general principles to create a single VAT space in the EU, which would help to put an end to a fraud that is worth €50 billion a year. (Original version in French by Lionel Changeur)