Brussels, 17/03/2008 (Agence Europe) - “Through the written procedure, the Commission today adopted conventional measures to enhance the fight against value added tax (VAT) fraud,” said the spokeswoman for European Taxation Commissioner Lásló Kovács on Monday 17 March. These proposals for amending the VAT directive (2006/112/EC) and the regulation (1798/2003) governing administrative cooperation in this area seek, from 2010, to speed up the collection and exchange of information on intra-Community supplies of goods and services (see EUROPE 9620). The Ecofin Council will discuss this matter in April. In order to detect carrousel fraud more rapidly, the Commission proposes reducing to one month the period which persons liable to VAT have for declaring intra-Community transactions involving the supply of goods or services within the Community. From 2010, companies, then, will have to declare their intra-Community deliveries and member states will exchange information within the same timespan. Companies making cross-border transactions with a value of more than €200,000, will be obliged to submit their VAT returns monthly. The Commission says these measures will not impose an additional administrative burden on companies operating only occasionally across borders.
Other conventional measures are under discussion. There will “probably” be other proposals, Kovács' spokeswoman said. Some measures will not necessarily require any amendment of the legislation, such as the setting up, in 2009, of a department which checks the data on registration for VAT purposes. The Commission also says that progress has been made in discussions on automated access to certain non-sensitive data on taxable persons and harmonisation of the procedures for the registration and de-registration of persons liable for VAT.
In its communication on VAT fraud at the end of February, the Commission considered the three regulatory options on the table (see EUROPE 9608): - improving existing legislation; - introducing a reverse charge mechanism for VAT; - and taxing intra-Community deliveries in the member state of departure. European Finance Ministers are still deeply divided on these last two options, which are more ambitious because they affect the foundations of the European VAT system (see EUROPE 9615).
When asked about the conclusions of the Spring European Council, which invite the Commission to bring forward a legislative proposal on reduced VAT rates this summer and to consider whether tax measures can play a role in promoting energy efficient products (see EUROPE 9623), Kovács' spokeswoman said that the Commission was looking into the matter but the outcome of its investigation would not be known before June or July. If legislative measures were to be taken, there would be two possibilities: delaying the draft directive on reduced VAT rates, expected for early July, or making a separate proposal later. (M.B.)