BETA

Awaiting committee decision



2017/0251(CNS) Value added tax (VAT) system: harmonising and simplifying certain rules and definitive system for the taxation of intra-Union trade
RoleCommitteeRapporteurShadows
Lead ECON KOFOD Jeppe (S&D) MALETIĆ Ivana (EPP), LOONES Sander (ECR), CORNILLET Thierry (ALDE), KAPPEL Barbara (ENF)
Opinion JURI
Lead committee dossier: ECON/8/11226
Legal Basis TFEU 113

Activites

  • 2017/10/26 Committee referral announced in Parliament, 1st reading/single reading
  • 2017/10/04 Legislative proposal published
    • COM(2017)0569 summary
    • DG {'url': 'http://ec.europa.eu/info/departments/taxation-and-customs-union_en', 'title': 'Taxation and Customs Union'}, MOSCOVICI Pierre

Documents

History

(these mark the time of scraping, not the official date of the change)

activities/1/committees/0/shadows/3
group
Verts/ALE
name
SCOTT CATO Molly
committees/0/shadows/3
group
Verts/ALE
name
SCOTT CATO Molly
activities/1/committees/0/shadows/3
group
ENF
name
KAPPEL Barbara
committees/0/shadows/3
group
ENF
name
KAPPEL Barbara
activities/1/committees/0/shadows/2
group
ALDE
name
CORNILLET Thierry
committees/0/shadows/2
group
ALDE
name
CORNILLET Thierry
activities/1/committees/0/shadows/1
group
ECR
name
LOONES Sander
committees/0/shadows/1
group
ECR
name
LOONES Sander
activities/1/committees/0/shadows
  • group: EPP name: MALETIĆ Ivana
committees/0/shadows
  • group: EPP name: MALETIĆ Ivana
activities/1/committees/0/date
2017-12-14T00:00:00
activities/1/committees/0/rapporteur
  • group: S&D name: KOFOD Jeppe
committees/0/date
2017-12-14T00:00:00
committees/0/rapporteur
  • group: S&D name: KOFOD Jeppe
activities/0/docs/0/celexid
CELEX:52017PC0569:EN
activities/0/docs/0/celexid
CELEX:52017PC0569:EN
activities/0/docs/0/text
  • PURPOSE: to improve the Union VAT system in the context of cross-border business-to-business (B2B) trade between Member States and to define the principles for a definitive VAT system.

    PROPOSED ACT: Council Directive.

    ROLE OF THE EUROPEAN PARLIAMENT: the Council adopts the act after consulting the European Parliament but without being obliged to follow its opinion.

    BACKGROUND: the European Commission has long-standing commitment to implementing a definitive VAT system that is well-suited to the functioning of the single market. The main idea in this regard was that doing business across the European Union should be as simple and as secure as engaging in purely domestic activities.

    In its April 2016 action plan on VAT, the Commission announced, inter alia, its intention to adopt a definitive VAT system for intra-Union cross-border trade based on the principle of taxation in the Member State of destination of the goods in order to create a robust single European VAT area.

    The Council reiterated its view that the principle of ‘taxation in the Member State of origin of the supply of goods or services’ should be replaced by the principle of ‘taxation in the Member State of destination’.

    In its resolution of 24 November 2016, Parliament also welcomed the Commission’s intention to propose a definitive VAT system by 2017 that is simple, fair, robust, efficient and less susceptible to fraud.

    On 8 November 2016, the Council stated that, while the Commission is working on the definitive VAT system for intra-Union trade, improvements to the current VAT system should be made in the meantime.

    IMPACT ANALYSIS: the preferred option, chosen in the impact assessment, would reduce cross border VAT fraud by EUR 41 billion and compliance costs for businesses by EUR 1 billion.

    CONTENT: this proposal to amend Directive 2006/112/EC (VAT Directive) is a step forward to replacing the transitional arrangements, applicable since 1 January 1993, by a definitive VAT system for intra-Union B2B trade under which domestic and cross-border transactions of goods will be treated in the same way.

    It makes improvements to the current VAT system and lays the foundations for the definitive system for intra-Union B2B exchanges. Its main elements are:

    1) Certified taxable person: the Commission proposed introducing the concept of the certified taxable person which would allow for an attestation that a particular business can globally be considered to be a reliable taxpayer. The concept is important because certain simplification rules, which could be fraud-sensitive, will apply only where a certified taxable person is involved in the relevant transaction. 

    The provision sets out the overall criteria on the basis of which the Member States will be able to certify taxable persons.

    In parallel, a proposal to amend the Regulation on administrative cooperation is presented in order to enable the certified taxable person status of taxable persons being integrated in the VIES (VAT information and exchange system).

    2) Call-off stock: the proposal provides for a simplification and uniform treatment for call-off stock arrangements in cross-border trade. The proposed solution consists in considering the call-off stock arrangements as giving rise to a single supply in the Member State of departure and to an intra-Community acquisition in the Member State where the stock is situated. This simplification is limited to certified taxable persons who will no longer need to register and pay VAT in another Member State when they store goods there.

    3) VAT identification number: the proposed amendments provide as a substantive condition for the application of the exemption, that the acquirer has to be identified for VAT purposes in a Member State other than that in which dispatch or transport of the goods begins. The correct filing of the VIES listing becomes a substantive condition which can lead, where that condition is not met, to the rejection by the tax administration of an applied exemption

    4) Chain transactions: VAT rules when determining the VAT treatment of chain transactions would be further harmonised. The Commission proposed that the simplification for those elements of a chain transaction which do not involve the physical movement of goods, for example when goods are sold via several traders, but physically the goods move directly from the original seller to the final buyer. This simplification is limited to certified taxable persons.

    5) Definitive system for intra-Union trade: the main foundations of the new single and definitive VAT area shall be:

    VAT shall be levied on cross-border business-to-business exchanges within the Union;

    ·         the definitive VAT system for intra-Union trade is based on the principle of taxation in the Member State of destination of the supply of goods or services; of liability for VAT of the supplier, or the acquirer if he is a certified taxable person, and of a single registration scheme for the declaration, payment and deduction of the tax;

    ·         where the person liable for VAT is not established in the Member State where the tax is due, he shall be able to settle his declaration and payment obligations via a so-called One-Stop Shop system. Use of that system shall also be possible for the deduction of input VAT.

    Lastly, although at this stage not yet explicitly stipulated, the system could or should further be based on the abolition of the recapitulative statement (the so-called VIES listing), the application of the overall invoicing rules of the Member State of the supplier, and the harmonisation of certain rules related to invoicing (such as the time of issuing of invoices).

activities/1
date
2017-10-26T00:00:00
body
EP
type
Committee referral announced in Parliament, 1st reading/single reading
committees
procedure/dossier_of_the_committee
ECON/8/11226
procedure/stage_reached
Old
Preparatory phase in Parliament
New
Awaiting committee decision
activities/0/commission/0
DG
Commissioner
MOSCOVICI Pierre
other/0
body
EC
dg
commissioner
MOSCOVICI Pierre
activities
  • date: 2017-10-04T00:00:00 docs: url: http://www.europarl.europa.eu/RegData/docs_autres_institutions/commission_europeenne/com/2017/0569/COM_COM(2017)0569_EN.pdf celexid: CELEX:52017PC0569:EN type: Legislative proposal published title: COM(2017)0569 body: EC type: Legislative proposal published commission:
committees
  • body: EP responsible: True committee_full: Economic and Monetary Affairs committee: ECON
  • body: EP responsible: False committee_full: Legal Affairs committee: JURI
links
other
    procedure
    reference
    2017/0251(CNS)
    instrument
    Directive
    legal_basis
    Treaty on the Functioning of the EU TFEU 113
    stage_reached
    Preparatory phase in Parliament
    summary
    subtype
    Legislation
    title
    Value added tax (VAT) system: harmonising and simplifying certain rules and definitive system for the taxation of intra-Union trade
    type
    CNS - Consultation procedure
    subject
    2.70.02 Indirect taxation, VAT, excise duties