EU ECOFIN future of VAT
- Oct 16, 2016 | Richard Asquith
The European Union’s ECOFIN, council of EU finance ministers, published draft consultations on measures to improve the single-market’s VAT regime. The initiative is part of the European Commissions April 2016 EU VAT Action Plan.
The underlying aim of the discussed reforms is to harmonise the EU VAT regime, stimulate cross-regional trade and reduce the opportunity for criminals to exploit intra-community VAT arrangements. It is part of the EC’s drive towards a definitive VAT regime – the current ‘temporary’ regime was set in-place in 1993 with the launch of the EU single market.
Issues discussed in the document include:
- Chain supply transactions and the lack of harmonization between member states on rules such as transportation and triangulation
- Call-off stocks and the inconsistences of requirements to VAT register between the member states
- Requirements for proof of legitimate intra-community supplies and proof of dispatch or transport
- VAT number checking and the VIES system
The next step is for the EC to draw up proposals to tackle the issues above to present to ECOFIN.