EU VAT Developments Beyond the ViDA Reforms

• The European Commission completed a preliminary review on post-ViDA VAT reform, focusing on simplification, digitalisation, and environmental goals; a final report is expected by December 2025.

• Reform topics include VAT exemptions, special schemes, split payments, crypto-asset VAT treatment, e-invoicing enhancements, data storage, and promoting environmental objectives through VAT adjustments.

• VEG 2024 proposed broadening the VAT base, improving deduction rights, standardizing data rules, and removing outdated exemptions, derogations, and special schemes to modernize and harmonize the EU VAT framework.

• Proposals include shifting to destination-based taxation, reconsidering VAT exemption for financial services, and creating a single EU VAT authority, while limiting VAT’s use in environmental policy to reduce distortions.

Source: vatcalc.com

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