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France announcing mandatory, most likely clearance-based, e-invoicing system for all transactions

*Attributed to Filippa Jörnstedt, Regulatory Counsel, Sovos*

France announcing a move to a mandatory, most likely clearance-based,
e-invoicing system for all transactions is another major milestone in the
increasing move towards the full digitisation of tax controls. That now
makes two major European economies, Italy and France, that have taken up
the e-invoicing mantle as well as a real-time clearance system, echoing
those used in Brazil and Turkey.

It makes sense that France is moving to this system; their VAT gap and tax
IT infrastructure mirrors that of Italy, so experts were already predicting
this move. The impact of e-invoicing in Italy since the turn of the year
has already had a substantial impact on the amount of VAT they were missing
out on (33.5 billion euros in 2017), again an encouraging sign for the
French. Indeed, early estimates show that the Italian regulators may well
recover several billion more in 2019 than they initially anticipated.

Looking at the plans as they are now, detail is light – only 3 paragraphs
or so from the French Finance Bill for 2020 is dedicated to the transition.
Of course, the aim is to have the new system go live in 2023 and be fully
in place across the economy by 2025, so there are plenty of projections,
details and technical aspects to be worked on – not to mention approval
from the European Union.

But for businesses – whether in France or working within the country in
some capacity – just over 3 years is not a long time at all to adjust to
this new system. They need to start paying attention and preparing now.
Clearance systems, working in real-time, leave very little breadth for any
mistakes to be rectified; supply chains could judder to a halt without the
right technology and compliance in place.

See the previous post from SOVOS about this here.

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