From 1 January 2020, the Netherlands will cut the VAT rate applicable on e-books from 21% to 9%…
Austria recently announced that from 1 January 2020, it plans to make online marketplaces (such as eBay, Amazon etc.) liable for unpaid VAT by merchants selling through their platforms.
This new liability follows similar regulations introduced by Germany and the UK and should help to prevent online VAT fraud, which is estimated to cost the European Union up to €5 billion per year.
From 1 January 2020, Austria will cut the VAT rate applicable on e-books from 20% to 10%.
This follows the EU Councils proposal to allow EU member states to cut rates on electronic publications to match their printed equivalents, please click here for the full article.
The implementation of the EU VAT directives on vouchers and electronic services has been published in the official gazette on 22 February 2019.
On 25 February 2019, the Bulgarian National Revenue Agency published guidance on the potential VAT and customs implications of a no-deal Brexit for Bulgarian companies.
Within this guidance the National Revenue Agency provides various recommendations to companies doing business with the United Kingdom concerning:
- Registration with the customs authorities for trading with non-EU countries
- Checking whether they have the required human resources, technical capacity and customs permissions for trading with non-EU countries
- Considering an application for obtaining Authorised Economic Operator status – this status is an internationally recognised quality mark that allows businesses access to some simplified customs procedures
- If registered under the Mini-one-stop-shop (MOSS) scheme in the United Kingdom, consider moving this registration to one of the other 27 EU member states
- Making any EU VAT refund directive claims relating to UK VAT well in advance before 29 March 2019 (the original date of the UK’s withdrawal from the EU) – The EU VAT Refund Directive is a mechanism in which EU companies can claim VAT incurred in other EU countries outside of a VAT registration.
The Cypriot tax authorities have recommended that Cypriot and UK businesses, who use the EU Refund Directive mechanism to claim back VAT incurred in the UK and Cyprus during 2018, should complete their applications by 10 March 2019 – this date will be updated in accordance with the actual date of the UK’s withdrawal from the EU.
Normally these types of claims would have a submission deadline of 30 September in both countries. However, due to the uncertainty of a no-deal Brexit the Cypriot tax authorities are advising to file these claims by 10 March 2019.
Furthermore, the Cypriot tax authorities have stated that in the event of a no deal Brexit, UK companies will have to submit these types of VAT reclaims as if they are a non-EU business (using the 13th Directive Refund claim mechanism) after 29 March 2019.
Starting from 1 April 2019, performers and their representatives will be able to opt to be exempt from VAT or to be subject to a 10% reduced VAT rate on their remuneration and fees for athletic and other public performances and copyright.
The French tax authorities have updated the 2019 VAT exemption threshold for non-profit organisations carrying out ancillary commercial activities to EUR 63 059 of commercial profits.
On 28 January 2019, the German Ministry of Finance issued official guidance on the application of the new sections 22f and 25e of the German VAT Act regarding record-keeping obligations of operators of online marketplaces. Such operators are obliged to keep records of the German VAT registration certificates from the resident and non-resident sellers or must have the digital confirmation from the German federal tax authorities of the seller’s accurate VAT compliance. Furthermore, in case the VAT is not collected by the vendors, including those that are not registered in Germany, the operators of online marketplaces become VAT liable in their place.
On 8 February 2019, a draft bill that implements the provisions of the EU Directive 2017/2455 (E-Commerce package) concerning for supplies of services and distance sales of goods, was adopted by the parliament. The respective provisions are effective as from 1 January 2019.
The eBrief No. 034/19, which updates the manual on the VAT treatment and VAT rates applicable to food supplements has been enacted. The new VAT rate was planned to come into effect on 1 March 2019 however it has been now delayed until 1 November 2019.
Italy has announced plans to make online marketplaces responsible for the VAT on sales of electronic goods under a value of €150, made by non-EU sellers. If implemented this will apply to sales of mobile phones, video games, tablets and games consoles for example.
Under these new rules, it will mean that the online marketplaces will have to first acquire the goods from the non-EU seller and then undertake the local sale to the consumers themselves. The marketplace will then be responsible for charging, collecting and remitting VAT to the Italian tax authorities on the transaction.
This measure is designed to help to prevent online VAT fraud and mirrors the proposal by the European Commission to make online marketplaces liable to all VAT on sales of goods through their platforms by 2021.
The Council Implementing Decision (EU) 2019/309 of 18 February 2019 grants Lithuania an authorization to introduce the reverse charge mechanism for the sales of certain IT equipment, such as mobile phones, tablets and hard drives. The authorization has been granted from 1 March 2019 until 28 February 2022.
From 1 January 2020, the Netherlands will cut the VAT rate applicable on e-books from 21% to 9%.
This follows the EU Council’s proposal to allow EU member states to cut rates on electronic publications to match their printed equivalents.
From 1 July 2019, Poland will introduce a temporary mandatory split payment regime for companies involved in business to business (B2B) sales within certain sectors prevalent to VAT fraud.
Once introduced the split payment procedure will mean that customers of the businesses affected will have to pay the VAT amount of a sale directly into a special supervised bank account, while paying the net amount directly to the supplier. The tax authorities can then monitor the bank account and make withdrawals in order to settle the supplier’s VAT liability.
This follows the introduction of a similar voluntary scheme for all businesses during July 2018. The sectors affected will be steel, scrap, electronics, gold, non-ferrous metals, fuels, and plastics.
On 13 January 2019 the reduced VAT rate of 5% became applicable to the supplies of transport of passengers by train, cable car, animal-drawn vehicle or boat for tourism or leisure purposes.
The moment of adjustment of the VAT taxable base in case of debtor’s bankruptcy was changed by Law 30/2019. The new provision foresees that the date from which this adjustment is allowed is the date of issuance, by the court, of the decision for starting the bankruptcy procedure (and not anymore from the date of closing decision of the bankruptcy procedure).
The Spanish Tax Administration clarified the criteria for the application of the reduced VAT rate (10%) for performers, artists, directors and technicians:
- The performer, artist, director or technician must be an individual;
- It applies whether the services are hired by an agent acting on behalf of the artist or if artists are hired as employees to render that service;
- Theatre plays and musical organizers are individuals or entities who manage material and human resources for the performance of the show;
- Theatre plays must include text recited or other forms of artistic expression adapted to the stage, whereas musical plays must include a sound scheme;
- Puppets theatres, storytellers and poetry reading shows have the status of theatre play for the application of the reduced rate (magic shows are not included).
The above information was kindly provided by:
- Fiscal Solutions (UK), fiscalsolutions.co.uk; contact: [email protected]
- Ryan VAT Systems (France), vatsystems.eu; contact: [email protected]