VATupdate Newsletter Week 42 2025

CODES

This Week’s Top 5 VAT Highlights

Netherlands – A Dutch case clarified when the transfer of a school building constitutes a VATable economic activity. A key decision for municipalities, educational foundations, and property developers.
France – A French court ruled that an in-kind contribution (asset transfer in exchange for shares) can fall outside the scope of VAT when no reciprocal consideration exists. Important for corporate restructurings and VAT planning.
Sweden – Sweden released updated guidance on how businesses with both taxable and exempt supplies must allocate input VAT — a reminder that mixed-activity businesses need to revisit their routines now.
Lithuania – Extension of the reduced VAT rate (12%) to additional categories including tourism and heating services. While a fiscal measure, this has VAT classification implications for multi-use services.
Greece – The Greek supreme administrative court struck down the VAT exemption for an intra-EU goods transaction, reinforcing that mere formalities are not enough: actual movement of goods and bona fide conditions remain essential.

That last case reminds us that transactions must be traceable: you follow the flow of the goods. And you must be able to show the tax authorities that the goods were indeed moved to another country.

It might be so much easier if there were some sort of secret code you could add to the goods so that you could trace them. That’s at least what printer manufacturers do.

Imagine this: it’s Monday morning and you’re in the office printing copies of invoices, supporting documentation, reports, etc. You might think that once it’s printed, it’s “just a piece of paper”. But here’s a twist: many printers and copiers are quietly stamping every sheet with a near-invisible digital footprint.

Hidden within the page, often disguised in the yellow toner channel, lies what’s known as a Machine Identification Code (MIC). This code encodes information such as the printer’s serial number, date/time of printing, and device identification. In short: your innocent printed invoice might carry metadata linking it back to the specific printer that produced it.

Could this be a tool in the war against VAT fraud?

In many jurisdictions, printed invoices, credit notes, and supporting documents form part of the VAT audit trail. If printed pages carry hidden MIC metadata, tax authorities (or forensic experts) could theoretically trace them back to the exact device and time of printing. That turns what looked like a simple paper archive into a digital breadcrumb trail. For VAT compliance teams, this means printing is not as anonymous as you may have assumed.

Having said that, with the rapid digitalisation of business and the move toward paperless offices, printed documents are losing their importance. Where the FBI once solved crimes by analysing fonts and printer patterns on ransom notes, it’s now the digital footprints that tell the story.

And that’s exactly what tax authorities are focusing on. Electronic invoicing, real-time reporting, and transaction-level data are today’s invisible codes: the modern version of those yellow dots. Because in the end, whether it’s a printed page or a truckload of goods, VAT is always about traceability. You can’t hide from the taxman: he might not see your printer’s yellow dots, but he’ll definitely follow your digital ones.

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