In 1698, Russian Tsar Peter the Great introduced a ‘Beard Tax’. He did this after his visited Western-Europe, where he liked their fashion sense of not wearing long beards, as was exceedingly popular in Russia at that time. Peter degreed that everyone with a beard had to pay tax. In turn, everyone who paid the tax, was given a ‘beard token.’ If you were stopped by the police without the token, they would immediately shave your beard off.
You can read more about the beard tax and the ‘fashion police’ HERE
Taxes have been existing for a long time. The beard tax is just an example of a special type of tax, instead of a ‘straightforward’ tax on income or turnover. The beard tax was in fact also income related: rich people with beards were taxed higher than poor people. And the extremely poor people went around bare faced… Which was in fact the way Peter liked it!
VAT is the same for everyone, whether you are rich or poor. At least, that was the initial intention of this type of taxation: the more you consume, the more you pay. Or: The more you can spend, the more you pay. But for the basics, everyone pays the same, which means that the rich people have more left to buy more…
Therefore, there is the possibility to apply reduced rates for ‘essential’ products and services. This reduces the costs of these items, which means that everyone has more left to spend on ‘luxurious’ products and services. We have mentioned this before, but the latter is nowadays used increasingly to steer consumption as well. Exactly like Peter the Great did.
The beard tax was part of a larger project: Peter the Great’s aesthetic reinvention of Russian culture. Not just the beards, but also fashion was influenced by Peter’s intention to make Russia look more like ‘modern Europe.’
Besides the beards, Peter ordered his subjects to replace their usual long Russian overcoats with French or Hungarian jackets. He even had mannequins put outside the Moscow city gates to illustrate the new fashions for all to see. Tailors who continued to sell Russian styles were fined, and anyone walking the streets in an old-fashioned robe ran the risk of having it cut short by the Tsar’s inspectors.
Steering consumption is not new. Governments nowadays aim to improve health and safe the environment. But in a way, that is the same as all of us having to wear the same fashion and not wearing beards. Unless you can afford to do so…
See you again next week!
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We are looking forward seeing you again next week.
WORLD
- Job opportunities in Australia, Singapore, United Kingdom
- Job opportunities in Denmark, India, Netherlands, United Kingdom
- Early 2022 E-Invoicing/Real Time Reporting developments
- E-Invoicing & Digital Reporting Global Updates
- Expanding online goods and service sales is making tax technology stronger
- PE Watch – Latest developments and trends, January 2022
- Taxation of the digitalized economy – Developments summary
- The Rise of E-Transport Documents
- Welcome to the Carbon Taxation e-course
WEBINARS / EVENTS
AFRICA
- Finance Act 2021: Sugar Tax + VAT obligations of digital non-resident companies
- Seductive VAT data raises more questions than answers
AMERICAS
- Imminent Outsourcing Reporting Obligation For VAT-IEPS Certified Companies and Others to Mexican Tax Authority (SAT)
- Major changes to e-invoicing in Mexico
- Tackling climate change in Mexico: An overview of green taxes
- Certain non-resident digital service providers must register with tax administration
- Paraguay Extends VAT and Consumption Tax Relief for COVID-19
- Alabama Manufacturer Requests Reduced Machine Rate
- California Expands Sales Tax Exemption to Include Electric Power
- Computer software subject to sales tax (Tennessee)
- Illinois Clarifies Taxation of Software as a Service
- Intro To Resale Certificates
- Louisiana Online Travel Companies Not Responsible for Taxes on Hotel Bookings
- Louisiana Revenue Department Urges Federal Court to Dismiss Constitutional Challenge to Fragmented State Sales Tax System
- Maryland Comptroller Adopts Rules for New Digital Advertising Tax
- Massachusetts Appellate Tax Board Explains that DOR Cannot Enforce Wayfair Retroactively
- Minnesota Clarifies Sales Tax for Online Discounts and Alternative Forms of Payment
- New York Grants Sales Tax Refund to Online Loan Marketplace
- Nuances of State Sales Tax Voluntary Disclosure Programs
- President Biden signs Uyghur Forced Labour Prevention Act with implications for US importers
- Recent developments affecting US trade
- Sales tax exemption for manufacturers (Pennsylvania and Texas)
- Sales tax in the news: Louisiana sued for complex sales tax system
- Stay Informed on Sales and Use Tax in the New Year
- Streamlined Sales Tax Governing Board Releases New Exemption Certificate
- Tennessee Aircraft Repair Sales Tax Exemptions
- The Basics of U.S. Sales Tax Growing International Retailers Must Know
- US Alaska 2% sales tax proposal July 2022
- You Probably Owe Sales Tax on SaaS (Software as a Service)
ASIA-PACIFIC
- A2ZTaxCorp’s Weekly GST Communique dated January 10, 2022
- ACMA seeks uniform GST rate of 18 per cent on all auto components
- Businesses to be given ‘reasonable time’ to explain mismatch in GSTR-1, 3B
- Clarification of customs treatment of automobile parts
- GST Compliance Calendar 2022
- GST Updates – Jan 10, 2022
- GST Updates – Jan 11, 2022
- GST Updates – Jan 12, 2022
- GST Updates – Jan 13, 2022
- GST Updates – Jan 14, 2022
- GST Updates – Jan 15, 2022
- Health care services offered on flat fee exempt from GST: AAR
- Is GST recovery proceeding justified for differences in outward supply in GSTR-1 vs. GSTR-3B
- Now, AAAR rules ready-to-eat fryums papad to draw 18% GST
- Taxmen To Give “Reasonable Time” To Explain GST Mismatch
- Incentives for VAT in the Health Sector Extended Until June 2022
- Indonesia adds to VAT collector list as digital VAT receipts rocket
- Indonesia Appoints Additional VAT Collectors for Rules on Taxing Digital Goods and Services
- Overview of guidance on service tax refunds for foreign registered persons
- Update on RMCD’s interpretation of “same digital service” and intragroup relief
- Value-added tax to be cut to 8 pct from February
- Vietnam Approves 2% VAT Reduction and Other Relief for 2022
EUROPE
- Amazon and One Stop Shop: Changes for sellers, FBA dealers, and more
- AmCham EU position paper: Challenges facing the Customs Union
- EU definitive VAT system lives?
- EU to Consider Tax E-Invoicing Push, Eyes Harmonization in 2022
- EU VAT Committee on VAT rules applicable to transactions related to the recharging of electric vehicles
- European Commission builds on “Fit for 55” energy and climate package with new measures
- European Commission study on e-commerce
- European Commission’s tax package: new own resources (Carbon Tax, EU Emissions Trading Scheme, P1)
- Flexibility, equality, modernity, and harmonisation are key to delivering a compromise solution on EU VAT rates rules, writes Olivier Chastel
- Intrastat and customs declarations – Changes as of 2022
- Intrastat thresholds in the EU – 2022 update
- New proposed VAT exemption certificate for certain goods related to the EU response to the COVID-19 crisis and to defence efforts under the CSDP
- Types of transactions for Intrastat declarations from 2022: A New List
- VAT and online events Light at the end of the tunnel?
- VAT identification number and country of origin for Intrastat reporting: New requirements from 2022
- VAT Treatment of Online Events in the EU
- When is VAT due or paid?
- Agenda of the ECJ VAT cases – 4 cases announced until February 10, 2022, 1 decision, 3 AG Opinions
- ECJ C-141/20 (Norddeutsche Gesellschaft für Diakonie mbH) – Opinion – VAT group: Controlling member not necessarily representative of VAT group
- ECJ C-156/20 (Zipvit Limited) – Judgment – Deduction of input tax is not possible without possession of an invoice stating the VAT
- ECJ C-513/20 (Termas Sulfurosas de Alcafache, S.A) – Judgment – Spa treatments are VAT exempted as medical and healthcare service
- ECJ C-664/21 NEC Plus Ultra Cosmetics AG vs. SI (Questions): New evidence to substantiate intracommunity supply allowed?
- ECJ C-669/21 Gencoal S.A. vs PT (Questions): Deadline for cross border VAT refund by taxable persons in other EU member states
- ECJ C-677/21 Fluvius Antwerpen vs. BE (Questions): Is the unlawful use of energy is a supply of goods?
- ECJ Customs – Joined cases C-415/20, C-419/20, C-427/20 – Opinion – Payment of interest in case of refund
- ECJ Excise Duties C-326/20 (MONO) – Judgment – A Member State cannot lay down the conditions on the exemption on goods used in diplomatic and…
- Commentary on ECJ C-324/20 (X-Beteiligungsgesellschaft mbH) – When do instalment payments become subject to VAT?
- Flashback on ECJ Cases – C-114/14 (Commission v Sweden) – Exemption for public postal services
- Flashback on ECJ Cases – C-132/06 (Commission v Italy) – Validity of VAT amnesty
- Flashback on ECJ Cases C-455/05 (Velvet & Steel Immobilien) – No exemption Credit Guarantees for obligations which are non-pecuniary, such as the obligation…
- Roadtrip through ECJ Cases – Focus on ”Exemption for Credit guarantees” (Art. 135(1)(c))
- Roadtrip through ECJ Cases – Focus on ”Exemption for Public Postal Services” (Art. 132(1)(a))
- Abolition of flat-rate regulations for both VAT and income tax
- Belgium domestic energy VAT cut to 6% proposition
- Covid-19: Permanent reduction of VAT refund minimum amounts and temporary import VAT exemption of certain products
- Each Region in Belgium has now implemented mandatory B2G E-Invoicing
- Finance Minister confirms intention to implement mandatory B2B e-invoicing
- Hairdressers – VAT package: no adjustment for the 4th quarter of 2021
- New Year’s letter VAT: Can you still see the wood for the trees?
- Permanent reduction of VAT refund minimum amounts, and temporary import VAT exemption of certain products
- Proposal: Temporary VAT reduction from 21 to 6 % on energy to reduce the price for consumers
- The new VAT exemption for the (para)medical sector explained
- Czech Republic aims to double VAT registration threshold
- Delay of implementation EET electronic cash registers until 1 Jan. 2023
- Direction Générale des Finances publiques organizes 3rd online workshop “external specifications #B2B”
- France has introduced VAT package on the implementation of EU Directives on e-commerce transactions
- Mandatory import VAT reverse charge
- Operations between head office and branches: the French tax authorities comment on EU cases Skandia and Dansk bank
- The new tax code on goods and services: a consolidation of sources expected
- VAT payable on down payments for deliveries of goods
- Sale of admission tickets for events, non-objection regulation
- Update on e-Invoicing in the German Federal States
- Will the German coalition agreement allow the European Commission to make progress on the Destination Based Taxation?
- Automatic VAT rebates soon
- e-Tax Compliance in Greece – myDATA
- Government may reduce VAT in some products to contain surging costs
- Greece next to cut VAT to alleviate inflation effects
- No Plans to Lower VAT Rates, Greek FinMin Says
- The pre-filled VAT returns are coming
- 2022 Budget: Plastic tax delayed, VAT rate on feminine hygiene products is reduced from 22% to 10%
- Approval of the VAT/2022 return forms concerning the year 2021, with the relevant instructions
- Clarification 15/2022: Transfer of a swimming sports facility to the municipalities
- Clarification 8/2022: VAT exemption for non-usage securities and valuables custody service
- Italy: Goods and Services supplied to combat COVID-19
- Live virtual tours in museums VAT exempted
- Medical Device Coordination Group published a new document on the obligations applicable to importers and distributors
- The transfer of a swimming pool to shareholders can be classified as a transfer of a going concern
- Transactions treated as exports: vessels used for high sea navigation
- Treasury services provided to a Municipality by a bank are exempt for VAT purposes
- VAT evasion, Guerra pushes on the use of big data: “Yes to profiling thanks to information integration”
- VAT treatment of distance learning courses
- Year-end TP adjustments may not be relevant for VAT purposes
- No contribution from VAT compensation fund for emergency landing in ferry port
- No input VAT deduction for investment in solar panels
- Policy Review VAT Compensation Fund (govt)
- Policy tax authorities on cryptocurrencies (including bitcoins) public
- Tax authorities policy on cryptocurrencies partly public
- The new cabinet wants to steer consumption behaviour, “but also look at good VAT and excise legislation”
- What do the tax authorities think about paying in and receiving bitcoins?
- Changes in Polish VAT for 2022
- New version of JPKV7 (VDEK) from 2022
- Poland to cut VAT on heating and electricity, says PM
- The government is proposing a reduction in VAT on food, energy, and fuels
- The so-called anti-inflationary shield 2.0 went to the Sejm
- Threads with zero VAT for gas and electricity. The EU will not agree to this.
- VAT reduction passed. Nobody was against
- High-risk products are defined as part of the new e-invoicing framework
- Romania B2B RO e-invoicing eFactură 2022 registrations
- Romania considers zero VAT on food as inflation rises
- Romania launches e-Invoicing for high-risk products!
- Romanian Govt. ponders 5% preferential VAT rate for energy after April
- VAT Refund Procedure for Amounts Paid in Excess by Taxpayers Applying VAT Special Schemes
- Basic agricultural and basic forestry activity and the right to claim a flat-rate compensation
- COVID-19: VAT exemption for medical supplies extended till June 30, 2022
- Disrupted operation of the eDavki system, G2G services and the Receptor Portal, 11 January 2022
- Extension of the VAT and import tax exemption for the supplies of protective and medical equipment
- Guidance: agricultural activities and VAT
- Tax treatment of virtual currency operations
- Legal case: a horse owner who allows a horse to participate in a premium race for a fee sells a service
- Refund of VAT to taxable persons established in Sweden who carry out transactions in other EU countries
- Increase in VAT rates expected as of 1 January 2023 (?)
- Proposed VAT rate increase, to fund Swiss pension system
- VAT to stabilize Swiss Old Age Insurance – VAT rate increase coming?
- Cabinet of Ministers has updated the Procedure for exemption of medicines from VAT
- Cancellation of VAT registration: on what grounds?
- Conditional sale: taxpayers on accrual of VAT liabilities
- Goods / services purchased from non-VAT payers are transferred free of charge: is there an object of taxation?
- Improving leased property: when with VAT?
- New VAT rules for the supply of coal and / or enrichment products
- Right to submit an adjustment calculation for the period in which it was a VAT payer in case of cancellation of its registration as a VAT payer?
- Services received from a non-resident outside Ukraine: should they be reflected in the VAT return?
- Sold VAT-exempt goods at a lower purchase price: what are the consequences?
- Boris Johnson risks losing Tory voters by keeping VAT on energy bills, poll reveals
- Brexit One Year On – What Do We Know?
- Changes to VAT penalty regime delayed until 2023
- Completing a VAT return: guidance for businesses that trade worldwide
- HMRC delays: VAT group registrations and option to tax
- HMRC Guidance Claiming preferential rates of duty between the UK and EU
- HMRC Guidance: Completing a One Stop Shop VAT Return
- HMRC Guidance: Pay the VAT due on your One Stop Shop VAT Return
- HMRC Policy paper UK approach to negotiating a free trade agreement with India
- HMRC Policy paper VAT (Distance Selling and Miscellaneous Amendments) Regulations 2021 and VAT (Distance Selling and Miscellaneous Amendments…
- HMRC Statutory guidance: Notices made under the Customs Regulations 2019 from 1 January 2022
- Hostel accommodation for the homeless – exempt or VATable?
- Hotel granted the luxury of VAT recovery on a sale of shares to raise funds
- Import and export of goods between the UK and the EU: updates to the Border Operating Model
- Importing from and re-exporting union goods to the EU – flowchart (accessible version)
- Labour challenges Tories to scrap VAT on energy bills for a year
- Making Tax Digital for VAT is coming – are you ready?
- Plastic packaging tax anomalies may cause problems for businesses
- Postponement to introduction of Penalty Reform for VAT
- Self-assessment taxpayers must declare COVID grants on tax returns
- Splitting a business to avoid VAT registration: Disaggregation
- Tory suspended for voting to cut VAT on energy bills – despite Boris Johnson backing idea
- UK VAT penalty regime reform delayed till 1 Jan 2023 due to IT issues
- UK warns 1.1million taxpayers on 1 April 2022 MTD changes
- United Kingdom Eases Time Limitations for VAT Repayment to Overseas Businesses
- VAT Group Registration applications – VAT accounting and reporting pending HMRC’s response
- VAT Recovery on Cars and Motor Expenses – Part 2
- VAT recovery on deal costs – selling shares to fund ‘downstream’ taxable activity
- VAT treatment of payment to exercise break clause
- VAT was not due on the termination of a lease Topics (Ventgrove Limited v Kuehne and Nagel Limited)
- VAT, TOGCs and selling/buying a business
MIDDLE EAST
- 15 VAT violations registered in Bahrain
- Bahrain Provides Guidance on Transitional Rules for Increase in the VAT Rate
- Small traders in Bahrain feel pain of updating VAT
- Oman Provides Guidance on VAT for Oil and Gas Industry
- Oman Provides Guidance on VAT Registration Procedures for Non-Residents
- VAT Taxpayer guide on oil and gas industry
- Instalments and waivers possible as from 1 March 2022 for UAE tax penalties
- VAT Explained in the UAE: What is the nature of supply?
- VAT Explained in UAE: Categories of VAT Supplies