VAT Implications of Personal Data Sharing

Recent developments indicate that tax authorities, particularly in Italy, may classify personal data shared by users in exchange for digital services as a form of remuneration subject to VAT, prompting businesses to reassess their tax liabilities and compliance with GDPR.
The concept of “consent or pay” raises significant regulatory concerns, as users often provide personal data unknowingly or under pressure, challenging the notion of voluntary consent required by GDPR, and necessitating that businesses clearly communicate data usage purposes and provide genuine alternatives.
Entrepreneurs must navigate the evolving landscape of tax regulations and data protection laws, ensuring their business models remain compliant, particularly as authorities may intensify scrutiny over the economic use of personal data and its implications for VAT liability.

Taxable transaction