When will the Commission publish its proposals on EU VAT and e-commerce?

In our previous newsflash on VAT and e-commerce, we noted that the European Commission is drafting new e-commerce legislation in the field of EU VAT. Sources within the EU reveal that the legislative proposals may be published as early as November or December 2016. Even though the precise publication date remains uncertain, various developments at EU level underline that the proposals of the Commission are gaining momentum and will likely be published at short notice.

Opinion of the Committee of the Regions

Very recently, the Committee of the Regions published its views on the envisaged legislative changes in the field of EU VAT and e-commerce. Underlining the importance of a level playing field, the Committee supports the removal of the VAT exemption for imports of small consignments from non-EU countries. In addition, the members of the Committee are in favour of introducing a single VAT registration and compliance point (the so-called ‘one-stop-shop’) for e-commerce companies engaged in the intra-EU distance selling of goods (e.g. via webshops). On these points, the report of the Committee is in line with the plans of the European Commission. 

Increasing support for the Commission’s plans

The report of the Committee of the Regions is a sign that the legislative plans of the Commission can count on broad support. This also becomes clear from last week’s visit to Malta by Mr Ansip, the EU Vice-President for the Digital Single Market. Because Malta will take up the Presidency of the EU Council as per January 2017, Ansip amongst others discussed the best way forward with regard to the Commission’s proposals on EU VAT and e-commerce. The intention is to proceed with the intended legislative changes as quickly as possible.

Be prepared for the upcoming changes

With a view to the above, the Commission’s forthcoming legislative proposals on EU VAT and e-commerce are gaining momentum. If the proposals are indeed published in November or December 2016, the actual adoption by the Council and the EU Parliament may follow suit at short notice. Since the changes will have a significant impact on e-commerce within the EU, it is important that companies active within that field keep a keen eye on the developments. If you expect your business to be affected by the legislative proposals, we advise you to contact your Baker Tilly VAT Compliance advisor in order to discuss the proper way forward.