- The current Tour Operators’ Margin Scheme (TOMS) is outdated, creates legal uncertainty, and imposes heavy compliance burdens, especially for B2B transactions.
- Inconsistent application across EU Member States leads to competitive distortions and administrative complexity.
- Key issues include lack of VAT neutrality, difficulties in margin calculation, VAT on prepayments, ambiguity in customer status, and complex treatment of in-house and non-EU services.
- CFE recommends restricting TOMS to B2C transactions, excluding MICE services, introducing opt-outs, and considering a One-Stop-Shop (OSS) mechanism for VAT reporting.
- Equal treatment for non-EU travel agents and clearer guidance for zero-margin cases are also advised.
Source: taxadviserseurope.org
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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