European Commission proposal to strengthen VAT cooperation

21 December 2017

On 30 November 2017, the European Commission published a proposal for a Council Regulation amending the EU Regulation regarding measures to strengthen cooperation in the field of VAT. 

The following changes were agreed:

    Information would be exchanged between tax authorities without prior request;

    Joint tax audits: a single audit team of tax officers from two or more Member States may investigate cross-border transactions;

    Strengthening of Eurofisc: while the involvement of joint processing and analysis of data will remain voluntary, member states will be required to grant access to their VIES data through a specific software (TNA). Eurofisc will also be able to coordinate joint administrative enquiries and forward information on serious cases to Europol and OLAF;

    Cross-border VAT refund: administrative burdens will be lifted in cases where a cross-border VAT refund request procedure is carried out parallel to a VAT recovery assistance request. The amount claimed by the member state of establishment may be retained by the refunded member state if the tax debtor agrees to the direct transfer;

    Disclosure of serious VAT fraud cases to OLAF and European Public Prosecutor’s Office (EPPO);

    Updating the conditions for the exchange of information and the Commission’s exercise of implementing powers.

Changes becoming effective from 1 January 2020:

    Sharing data on customs procedures 42/63 and vehicle registrations with tax authorities: the aim of the proposed rules is to tackle the abuse of the VAT scheme for importing goods free of charge.

Changes becoming effective from 1 July 2021:

    Additional information on Member States’ VAT rules on the Commission’s website: Information will be extended to VAT rates and measures targeting small enterprises.

Author: Bettina Cassegrain, HLB Technical Director and Global Assurance Leader 

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