On 8 December 2022, the European Commission adopted and published its “VAT in the digital age” proposal, defining the core areas where European VAT will be modernized in the coming years. Alongside the changes made to the platform economy, e-commerce, and the single VAT registration in the EU, the proposal highlights the European Commission’s ambitious vision for how VAT reporting should embrace digital opportunities, with an implementation timeline set to commence at the beginning of 2028. At the EU level, there would be an obligation to issue structured e-invoices for all intra-EU supplies of goods and services, and to transmit data from these invoices to the relevant national VAT authorities’ electronic portal, in near real-time. This would require significant systems and process changes, and investment from all businesses engaged in cross-border trade within the EU, but would be expected to reduce VAT fraud losses for member states by up to EUR 11 billion per year. In a further positive development for businesses, the European Commission also has proposed that future domestic e-reporting changes would be based on the EU model.
Source Deloitte
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