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Germany referred to ECJ travel agents VAT

  • VAT
  • 28 April 2016 | Richard Asquith

Germany referred to ECJ travel agents VAT

The European Commission has today referred Germany to the European Court of Justice (ECJ) for its continuing non-compliance with the EU VAT Directive on travel agents. The EC had already sent Germany a reasoned opinion in 2015, which Germany has ignored.

Tour Operators Margin Scheme

The Directive provides a compulsory Tour Operators Margin scheme (TOMS) VAT simplification for travel agents buying and reselling holiday packages across the EU. It enables agents to avoid the obligation the VAT register in each EU state where they are reselling packaged holidays. Instead, they set a profit margin which is used to calculate the VAT due, and is payable only to the member state where they are established.

The aim of TOMS is to reduce VAT registrations, and ensure there is no distortion to competition. It is obligatory for agents selling to consumers and businesses.

Germany ignores EU VAT Directive

Presently, Germany only provides the scheme for sellers to consumers, which is in contrast to several ECJ rulings. The German margin calculation also differs from the Directive.


VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.