Taxation and Customs Union

Public Consultation on Modernising VAT for cross-border e-commerce

Title

Public Consultation on Modernising VAT for cross-border e-commerce

Policy fields

Taxation

Target groups

The open public consultation will seek the views of business, the public and representative organisations

Period of consultation

From 25.09.2015 to 18.12.2015

Objective of the consultation
  • The complications of having to deal with many different national tax systems represent a real obstacle for companies trying to trade cross-border both online and offline.
  • Since 1 January 2015, with the entry into force of new "place of supply" rules , VAT on all telecommunications, broadcasting and electronic services is levied where the customer is based, rather than where the supplier is located.
  • In parallel, a Mini One Stop Shop has been implemented to reduce the costs and administrative burdens for businesses concerned.
  • Currently goods ordered online from third country suppliers can in some Member States benefit from the small consignment import exemption (below a threshold of 10-22 EUR) allowing shipment free of VAT to EU private customers - This gives them a competitive advantage over EU suppliers, and market distortions have already been signalled in various Member States.
  • While acknowledging the benefits for business of not having to register up to the distance sales thresholds for intra-EU Business to Consumer (B2C) supplies of goods it is relevant that these thresholds may cause uncertainties for business and can lead to compliance challenges for Member State tax administrations.
  • Having carefully considered these issues, the Commission made a commitment in the Communication 'A Digital Single Market Strategy for Europe' (Com (2015) 192 final) indicating that it will make legislative proposals in 2016 to reduce the administrative burden on businesses arising from different VAT regimes.

The objective of the consultation is to seek the views on:

(1) The implementation of the 2015 changes to the VAT rules for business to consumer cross-border supplies of goods and services,
(2) The implementation of the 2015 changes to the VAT place of supply rules and the Mini One Stops Shop,
(3) The commitment by the Commission in 'A Digital Single Market Strategy for Europe' to:

(a) Extend the current single electronic registration (i.e. the  Mini One Stop Shop) and payment mechanism to intra-EU and 3rd country online sales of tangible goods,
(b) Introduce a common EU-wide simplification measure (i.e. a VAT threshold) to help small start-up e-commerce businesses,
(c) Allow for home country controls including a single audit of cross-border businesses for VAT purposes and               
(d) Remove the VAT exemption for the importation of small consignments from suppliers in third countries (i.e. non EU Member States).

How to submit your contribution

Respondents are offered an online questionnaire via the EU Survey Application which is available at the following link.  Responses are submitted through that application.

View the questionnaire

Questionnaire

Contact details

responsible service

Directorate-General for Taxation and Customs Union
VAT - Unit TAXUD/C1

e-mail TAXUD-C1-SECTOR-A@ec.europa.eu
postal address

European Commission
Directorate-General for Taxation and Customs Union
VAT - Unit TAXUD/C1
Rue Joseph II 79, Office J79 05/065
B-1049 Brussels
Belgium 

View the contributions

In the interests of transparency, organisations have been invited to provide the public with relevant information about themselves by registering in the Interest Representative Register and subscribing to its Code of Conduct. If the organisation is not registered, the submission is published separately from the registered organisations.

Results of consultation and next steps
Protection of personal data