- Approval of the VAT in the Digital Age (ViDA) Reform: On March 11, 2025, the Council of the European Union approved the ViDA reform after over two years of negotiations. This legislative framework aims to modernize and simplify the EU VAT system, culminating in the implementation of the ViDA package on April 14, 2025.
- Introduction of the Single VAT Registration (SVR) Pillar: A significant component of the ViDA reform, the SVR pillar, will streamline the EU VAT registration process, particularly for non-EU businesses. Key changes include expanding the One-Stop-Shop (OSS) for B2C transactions to cover additional goods and services, introducing a new OSS module for the movement of stock across Member States, and extending the B2B reverse charge mechanism.
- Impact on Businesses: The SVR aims to reduce the administrative burden and costs associated with VAT registration, decreasing the need for multiple registrations for non-established businesses. However, companies must remain vigilant, as the lack of VAT registration in the Member State where VAT is due could impact cash flow and complicate input tax deductions through the EU VAT reclaim process, which often results in delayed reimbursements.
Source 1stopvat
