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Germany stalls €7billion EU VAT e-commerce package

  • EU VAT
  • 07 November 2017 | Richard Asquith

Germany stalls €7billion EU VAT e-commerce package

Today’s monthly meeting of EU Finance Ministers, ECOFIN, failed to reach agreement on a proposed €7billion VAT E-commerce Package.  This included a plan to make the major international platforms (e.g. Amazon and eBay) potentially liable for VAT fraud by non-EU Sellers.

The Package aims to boost member states’ tax receipts by an estimated €7 billion by simplifying VAT on cross-border sales to consumers, and reducing the opportunity for online VAT fraud.  Proposals include:

  • 2019 several simplifications to the existing B2C MOSS scheme for electronic services
  • 2021 extension of the MOSS One-Stop-Shop to B2C e-commerce sales
  • Enhanced co-operation between tax authorities to reenforce the above measures
  • Withdrawing the low-value consignment stock VAT exemption on small imports

In addition, the European Commission proposed making the online marketplaces liable for any missing VAT from fraud by non-EU - primarily Chinese - e-commerce retailers on their platforms.

Agreement on the proposal was postponed as member states, notably Germany, raised concerns around the 2021 extension of the one-stop-shop. The states were concerned about ceding control of their tax collections to other states.  Germany referred to needing more time whilst its new government was formed.

ECOFIN will discuss the proposals again in December in an attempt to reach a compromise.

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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.