Activities of Lídia PEREIRA related to 2020/2263(INI)
Shadow reports (1)
REPORT on the implementation of the Sixth VAT Directive: what is the missing part to reduce the EU VAT gap?
Amendments (36)
Amendment 3 #
Motion for a resolution
Recital A
Recital A
A. whereas in 1977 the Council adopted a sixth VAT directive with a view to achieving a uniform tax base under which harmonised rates were to be set out; whereas, at the time, all Member States have already adopted a system of value added tax in accordance with the first and second Council Directives of 11 April 1967 on the harmonization of the laws of the Member States relating to turnover taxes; whereas the Member States decided to apply a transitional period in which to achieve this, which has since been extended;
Amendment 4 #
Motion for a resolution
Recital B
Recital B
B. whereas the VAT Directive18 has recast and repealed the Sixth Directive, for the purposes of greater clarification; whereas this directive provides for the transitional rules to be replaced by a definitive system based on taxation in the Member State of origin; whereas the transitional system is complex, flawed and structurally vulnerable to fraud; _________________ 18Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ L 347, 11.12.2006, p. 1).
Amendment 6 #
Motion for a resolution
Recital C
Recital C
C. whereas in 2013 a major overhaul was initiated to introduce a definitive system based on the destination principle, which makes it less vulnerable to fraud19 ; whereas the destination principle implies that VAT is levied on the Member State of the final consumption and this must lead to tax neutrality; _________________ 19 As outlined in the EU Action Plan on VAT of 7 April 2016.
Amendment 7 #
Motion for a resolution
Recital D
Recital D
D. whereas on 25 May 2018 a proposal for a directive was adopted which introduced detailed arrangements for a definitive VAT regime for intra-EU business-to-business trade in goods and put an end to the ‘transitional’ system; whereas Parliament adopted its position on 12 February 2019; whereas the Council has not yet adopted a position; whereas this decision blockade delays important decisions on adapting the VAT for the challenges we face in the framework of the European economy recovery; and that the absence of action leads to the maintenance of the loopholes that allow the VAT gap to grow;
Amendment 8 #
Motion for a resolution
Recital E
Recital E
E. whereas the VAT gap in the EU has been reduced from 20% in 2009 to 10% in 2019, according to fast estimates that indicates that the gap could fall below EUR 130 billion; whereas owing to the pandemic and its socio-economic effects, this trend was reversed in 2020; whereas estimated losses of EUR 164 billion have been incurred, of which one third has fallen into the hands of fraudsters and organised crime networks; whereas this losses can represent a VAT gap of 13.7%; whereas this scenario demands policy strategic options;
Amendment 15 #
Motion for a resolution
Recital F
Recital F
F. whereas Opinion No 11/2020 of the Court of Auditors focuses on the new method put forward for calculating the VAT-based own resource; whereas this opinion states that the proposal "significantly simplifies the calculation of the Member States’ VAT-based own resource as compared to the current system" but "identified the risk that the definitive multiannual Weighted Average Rate may not be representative for all Member States";
Amendment 17 #
Motion for a resolution
Recital F a (new)
Recital F a (new)
F a. whereas the VAT-based own resource accounted for 11% of the EU budget in 2019, on a total amount of EUR 17.8 billion;
Amendment 18 #
Motion for a resolution
Recital G
Recital G
G. whereas the Commission’s ‘Action Plan for fair and simple taxation supporting the recovery’ is part of the EU’s new strategy for simplifying and adapting taxation to the digitisation of the economy and the green transition, and for combating tax fraud and evasion; whereas this Action Plan identifies matters related to VAT as priorities, focusing on the fight against VAT fraud and the modernisation of VAT on financial services, taking into account the digitalization of the economy;
Amendment 19 #
Motion for a resolution
Recital H
Recital H
Amendment 20 #
Motion for a resolution
Recital H a (new)
Recital H a (new)
H a. whereas the VAT, as an indirect tax collected by all 27 Member States, comprehends several different national regimes and that from all of them it is possible to extract good practices and apply on a European-wide reform; whereas national examples should be considered as models to take into account and the European Commission must act as a platform to exchange such good practices; whereas the national legislative changes performed by Portugal, in 2013, creating incentives for consumers to request invoices in hard-to-tax sectors, are one of such good examples;
Amendment 32 #
Motion for a resolution
Paragraph 3
Paragraph 3
3. Takes the view that applying a multitude of reduced rates aggravates the complexity and opacity of the tax system, facilitates fraud and increases compliance costs; notes, however, that the reduced rates can be used to pursue important objectives, mainly on access to basic necessity goods; understands that the application of reduced rates must lead to a decrease on the price to the consumer;
Amendment 39 #
Motion for a resolution
Paragraph 3 a (new)
Paragraph 3 a (new)
3 a. Notes the amplitude of different standard rates between the Member States and the complexity that it brings to the system, although justified by different national economic systems; underlines that this complexity is aggravated by the different application of reduced rates that are legitimate to pursue social and environmental objectives; recalls that the possibility to apply super reduced rates (in 5 Member States) and parking rates (in 5 Member States) constitutes an additional obstacle to a coherent and fully interoperable common system;
Amendment 40 #
Motion for a resolution
Paragraph 3 b (new)
Paragraph 3 b (new)
3 b. Understands that the increasingly higher complexity of the system is motivated by te multiple rates, but mainly by the exemptions and derogations, that must be admitted as a exception; recalls the specific situation of unequal treatment of Member States pre and post 1992, to which different rules apply; calls on the Commission to address this issue in future legislative proposals;
Amendment 41 #
Motion for a resolution
Paragraph 3 c (new)
Paragraph 3 c (new)
3 c. Notes that, over the past two decades, the Commission has launched almost 200 infringement procedures; calls on the Commission to present a summary of the main findings of these procedures to prepare future legislative proposals, namely on reduced rates, exemptions and non-transposition;
Amendment 42 #
Motion for a resolution
Paragraph 3 d (new)
Paragraph 3 d (new)
3 d. Notes that the coronavirus pandemic justified VAT-related exception rules, that prove the need for a degree of flexibility to face urgent or unexpected circumstances; urges the Commission to take this into account on future legislative proposals regarding VAT;
Amendment 46 #
Motion for a resolution
Paragraph 4 a (new)
Paragraph 4 a (new)
4 a. Regrets the lack of available data on regional differences being possibly a major limitation for measuring the VAT gap; calls on the Commission to check whether producing regional VAT gap measurements publicly could be a valuable tool improving transparency and reducing the VAT gap;
Amendment 51 #
Motion for a resolution
Paragraph 6
Paragraph 6
6. Observes that SMEs must pay proportionately higher compliance costs, as these costs are fixed and independent of company size, and that high compliance costs constitute a barrier to entry into the EU internal market; takes the view, therefore, that significantly differentiated VAT regimes within the EU may act as a disincentive to exports;
Amendment 54 #
7. Notes digitalisation’s potential to reduce compliance costs; maintains that digital innovations23 are likely to reduce compliance costs and help increase the transparency of commercial transactions; stresses the need to ensure data security and individual and corporate privacy; looks forward to the legislative proposal for modernising VAT reporting obligations and calls on the Commission to come up with less red-tape focusing on easy application by traders; _________________ 23Such as AI, big data and blockchain technology.
Amendment 59 #
Motion for a resolution
Paragraph 7 a (new)
Paragraph 7 a (new)
7 a. Calls on Member States to increase and improve cooperation between themselves and apply thoroughly the set of rules on the exchange of VAT payment data to facilitate detection of tax fraud in cross-border e-commerce transactions adopted in February 2020;
Amendment 60 #
Motion for a resolution
Paragraph 7 b (new)
Paragraph 7 b (new)
7 b. Notes that Member States are already employing new technologies to improve the efficiency of domestic purchases control for tax matter; understands that these national measures must be taken into account in any VAT system reform, as good practices to be considered; stands for more coordination between Member States in this regard, in order to facilitate cross-border transactions, without excessive costs for operators and consumers; welcomes the Commission intention to present a legislative proposal for modernising VAT reporting obligations; calls on the Commission to present concrete proposals to promote a quicker system of exchange of information on VAT intra-EU transactions and to make it interoperable with national mechanisms; stands for the expansion of e-invoicing;
Amendment 61 #
Motion for a resolution
Paragraph 7 c (new)
Paragraph 7 c (new)
7 c. Underlines the urgency to tackle the VAT cross-border fraud and the carousel fraud, with the proper implementation of efficient exchange of information mechanisms and the adequate means (both human, financial, technical and technological) for authorities such as OLAF; stresses the valuable contribution of organisms like Eurofisc; recalls the role of payment services providers and the need to guarantee high standards of reporting on VAT;
Amendment 65 #
Motion for a resolution
Paragraph 8
Paragraph 8
8. Observes that the wide variety of rates causes price distortion in the internal market, creating incentives for cross-border purchases and giving rise to increased tax competition between Member States; recalls that companies need clear and unambiguous VAT rules to encourage cross-border business and reduce their administrative burdens;
Amendment 96 #
Motion for a resolution
Paragraph 12
Paragraph 12
12. Stresses that reduced rates are not anthe most effective way of achieving social or environmental objectives since they incur high costs for governments owing to the size of the rate gap, reduced tax revenues, increased administrative costs, costly checks and inspections, pressure from lobby groupsocial and economic representatives, compliance costs, economic distortions or even tax evasion, and the difficulty of reaching the target groups;
Amendment 99 #
Motion for a resolution
Paragraph 13
Paragraph 13
13. Takes the view that direct tax incentives, such as direct grants or tax credits targeting specific consumers and producers, are more effective, flexible, visible and cost- effective tools for achieving these social and environmental objectives; notes, however, that these tax incentives are at the core of national tax sovereignty and are comprehended in national competences and, in any scenario, must respect the EU competition policy;
Amendment 106 #
Motion for a resolution
Paragraph 14
Paragraph 14
14. Stresses that a uniform VAT system, combined with a direct tax incentive tool such as the income-based tax credit scheme for low-income households, together with a raft of social reforms, would be a winning strategy; recalls that New Zealand has a flat-rate VAT system and applies tax credit for low- income households; points out that flat-rate subsidies and information campaigns arcould be an option for the promotion of merit goods;
Amendment 130 #
Motion for a resolution
Paragraph 18
Paragraph 18
18. Calls for a simplified VAT system with limits on exemptions and non- standard rates to be introduced with a view to promoting competitiveness and improving voluntary compliance;
Amendment 138 #
Motion for a resolution
Paragraph 19
Paragraph 19
19. Stresses that the VAT gap is chiefly attributable to the ineffectiveness of enforcement and control measures, particularly those against tax evasion and avoidance and aggressive tax planning; calls, in this regard, on Member States to improve administrative cooperation and enhance the performance of national tax authorities;
Amendment 145 #
Motion for a resolution
Paragraph 20
Paragraph 20
20. Recalls that the effectiveness of reduced rates as a policy tool must always be assessed in the specific context of other existing policy tools; adds that reduced rates are often complementary to existing social and environmental policy tools; and that direct tax incentives are instruments that better target low-income households and are generally less costly;
Amendment 148 #
Motion for a resolution
Paragraph 21
Paragraph 21
21. Stresses the need to move to a definitive VAT system based on the principle of taxation in the country of destination; calls on the Council to adopt the proposal for a directive of 25 May 2018, without further delay; highlights in this regard the main principles of the prospective definite VAT system for cross- border trade taxation of intra-EU goods supplies at the destination and charging and collecting the VAT within the Member State of destination by the supplier;
Amendment 151 #
Motion for a resolution
Paragraph 21 a (new)
Paragraph 21 a (new)
21 a. Calls on the Commission to follow- up this report with concrete legislative proposals, addressing the specific topics referred; calls on the Council to value the dialogue and cooperation with the Parliament, pursuing a proper reform of the VAT system, having these proposals in regard and the fundamental need to guarantee a democratic character to the changes on the EU taxation policy;
Amendment 155 #
Motion for a resolution
Paragraph 21 b (new)
Paragraph 21 b (new)
21 b. Recalls the merits of the Taxpayer Identification Number (TIN) as a useful instrument to guarantee compliance and the respect for tax obligations; calls on the Commission and Member States to explore all the possibilities of the TIN as a mechanism to safeguard high standards of efficiency on reporting;
Amendment 156 #
Motion for a resolution
Paragraph 21 c (new)
Paragraph 21 c (new)
21 c. Supports the idea to expand the scope of the VAT One Stop Shop (OSS) which is in place since 2015 for the declaration and payment of VAT; underlines the need to specifically address the adaptation of the OSS to the increasingly higher dimension of e- commerce;
Amendment 157 #
Motion for a resolution
Paragraph 21 d (new)
Paragraph 21 d (new)
21 d. Calls on the Commission to assess the current framework and propose concrete legislative proposals on the verification of cross-border transactions, that must be reinforced to secure VAT; underlines, in this regard, the need to specifically address the opportunities that come from the use of new digital technologies, with high standards of data protection and privacy, as corollaries of taxpayers rights;
Amendment 158 #
Motion for a resolution
Paragraph 21 e (new)
Paragraph 21 e (new)
21 e. Recalls the urgent need to guarantee full transposition and proper implementation of the VAT e-commerce package; calls the Commission to evaluate the state-of-play in this regard and present concrete proposals to adapt the rules, having the circumstances of exponencial growth of e-commerce in consideration;
Amendment 159 #
Motion for a resolution
Paragraph 21 f (new)
Paragraph 21 f (new)
21 f. Recalls the importance of a closer dialogue with international partners, mainly the most relevant trade partners, regarding VAT; this cooperation bust start and be based on the dimension of administrative cooperation, in order to guarantee an effective logic of exchange of information that can enhance the combate against schemes leading to fraud or evasion;
Amendment 160 #
Motion for a resolution
Paragraph 21 g (new)
Paragraph 21 g (new)
21 g. Notes the Commission intention to change the nature of the VAT Committee and the objectives regarding a future "comitology committee"; underlines the need to count on the Parliament position on this matter; recalls the need to guarantee full respect for the european institutional framework on taxation and the distribution of competences regarding indirect taxation;