- Import VAT is a tax on goods purchased outside the EU, with varying rates and payment methods depending on the destination country.
- VAT must also be paid for goods delivered within an EU member state, with extended reverse charge procedures for non-EU suppliers. Intra-community transactions involving multiple stakeholders and countries require VAT registration, adding to the administrative burden.
- Non-compliance with VAT rules can significantly impact a business’s cash flow, with the European VAT gap amounting to €140 billion.
- Proactive approaches, such as using regtech solutions, can help manage VAT compliance in a global supply chain.
- Understanding and ensuring compliance with VAT regulations is crucial for reducing operational, reputational, and financial risks.
- The European Commission’s VAT project aims to digitalize and harmonize VAT collection in EU countries by 2028.
Source zdnet
