2026 Finance Act: Mandatory VAT Reverse Charge Targets Informal Economy and Industrial Waste Trade

• The 2026 Finance Act makes the VAT reverse charge mechanism mandatory for industrial processing companies buying new industrial waste, metals, and recovered materials from non-taxable or exempt suppliers.
• This measure targets high-risk sectors for tax non-compliance and aims to integrate the informal economy and combat tax fraud.
• The reverse charge mechanism, previously optional, will be compulsory from January 1, 2026, allowing VAT deduction on purchases except for land and agricultural products.
• The scheme may be extended to other activities in the future, depending on its effectiveness.
• The measure helps tax authorities identify and monitor previously unregistered or underreporting economic operators.

Source: leconomiste.com

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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