Value added tax (VAT) is one of the key revenue raisers in national budgets, representing on average almost one-fifth of all tax revenue collected in the European Union (EU). To help strengthen the fight against VAT fraud and reduce the administrative burden for businesses, the European Commission tabled a three-part initiative – VAT in the Digital Age – on 8 December 2022. As a first objective, the Commission proposes to introduce an EU-wide reporting system on intra-EU business-to-business (B2B) transactions, whereby companies would share, in real-time, data drawn from electronic invoices with the authorities. This would allow Member States to keep a close eye on the trail of VAT collected and to intervene when there is suspicion of fraudulent practices. Second, the European Commission proposes to introduce a harmonised framework for charging VAT in passenger transport and short-term accommodation platforms. Lastly, the initiative proposes measures to lower VAT compliance costs for companies operating across borders. For the proposal to become a directive, the Council needs to vote on it with unanimity, after having consulted the European Parliament and the European Economic and Social Committee. First edition. The ‘EU Legislation in Progress’ briefings are updated at key stages in the legislative procedure.