VAT Committee: Minutes 126th meeting – March 21, 2025

Overview

On May 5, 2025, the European Commission published the minutes from the 126th meeting of the VAT Committee, which focused exclusively on the implementation of the ViDA (Value Added Tax in the Digital Age) package adopted by the Council on March 11, 2025. The meeting was of an extraordinary nature, addressing immediate provisions and changes related to the ViDA package.

Key Points Discussed

• Adoption of the Agenda:
  • The agenda for the meeting was adopted without amendments.
• New Legislation:
  • The meeting addressed several new legislative matters concerning the implementation of recently adopted EU VAT provisions, focusing on two main areas:
    • a. Changes to Electronic Invoicing Rules:
      • The Commission presented Working Paper No. 1102 regarding amendments to Articles 218 and 232 of the VAT Directive, which will apply from the twentieth day following the publication of the ViDA Directive.
      • The objective was to establish a common understanding of the changes allowing for mandatory electronic invoicing in certain transactions and to clarify the responsibilities of taxpayers.
      • Key points included identifying which transactions will require electronic invoicing, the taxpayers affected, and the implications for reporting systems, particularly with an eye towards new rules effective from July 1, 2030.
      • The meeting concluded without comments or questions from delegations, and the Commission announced plans to prepare draft guidelines on these changes.
    • b. Amendments to the Administrative Cooperation Regulation:
      • Working Paper No. 1103 addressed changes to Article 17(1)(e) of the Administrative Cooperation Regulation, which will also take effect from the twentieth day after the ViDA package’s publication.
      • The amendment aims to enhance the Import One-Stop Shop (IOSS) by requiring monthly reports to include a breakdown of imported goods by Member State of consumption, enabling more precise audits by tax administrations.
      • Six delegations participated in the discussion, expressing support for the improved reporting functionalities. However, concerns were raised regarding the use of the Economic Operators Registration and Identification (EORI) number to determine the Member State of consumption. Delegates argued that since EORI numbers are typically assigned to economic operators, they may not be suitable for transactions involving final consumers.
      • The Commission responded that the final consumer’s address will be the primary data point, with the EORI number serving as a fallback in cases where the address is not available. This clarification aimed to address the concerns raised about potential dysfunctionality in the system.
• Transaction Monitoring:
  • Delegations inquired about the possibility of conducting transaction-by-transaction checks within the Surveillance system, to which the Commission indicated that due to the volume of transactions, this was not currently feasible.
  • There was also a call for static reports on IOSS transactions to be available per Member State of consumption, which the Commission confirmed is planned.
• Future Considerations:
  • The Chair concluded the meeting by thanking the delegations for their valuable contributions. It was noted that the points and concerns raised would be communicated to customs colleagues for further consideration during the implementation of the amendments.
  • The Commission also briefly informed the attendees about ongoing efforts to secure the IOSS number against tax evasion or avoidance, with a detailed update promised at the upcoming meeting of the Group on the Future of VAT on March 28, 2025.

Conclusion

The meeting underscored the European Commission’s commitment to refining VAT regulations in light of the new ViDA package, enhancing electronic invoicing, and improving the IOSS framework. The discussions highlighted the need for clear communication and collaboration among Member States to address practical concerns and streamline the implementation of these significant changes. The next meeting is scheduled for late spring 2025 and will be held online.

Source WP 1109 – Minutes 126th VAT COM meeting

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Agenda

1. ADOPTION OF THE AGENDA
2. NEW LEGISLATION – MATTERS CONCERNING THE IMPLEMENTATION OF RECENTLY ADOPTED EU VAT PROVISIONS
   1. Origin: Commission
      References: New Articles 218 and 232
      Subject: Changes in electronic invoicing rules applicable upon the entry into force of the VAT in the Digital Age Directive
      (Document taxud.c.1(2025)3620596 – Working paper No 1102)
   2. Origin: Commission
      Reference: Article 17(1)(e) of the Administrative Cooperation Regulation Subject: Changes applicable upon the entry into force of the VAT in the Digital Age Package making for the provision of IOSS monthly reports to be made per Member State of consumption
      (Document taxud.c.1(2025)3713315 – Working paper No 1103)
3. AOB

Source Circabc