A special report produced last year by the European Court of Auditors estimates that European Union (EU) Member States lose approximately €5 billion of VAT revenue annually on cross-border business-to-consumer (B2C) e-commerce supplies of goods. Fraud is a major cause of this shortcoming, and the EU’s forthcoming rules changes regarding certain e-commerce transactions are designed to reduce instances of fraud. These VAT compliance changes, which take effect Jan. 1, 2024, will have major implications on “payment services providers (PSPs)”, so it is important to understand the rationale for this rules update.
Source: Vertex
