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News from EU, Accountancy Europe – November 2024

By November 18, 2024No Comments

Key tax commitments from Commissioner nominee Wopke Hoekstra for 2024-2029 term

Between 4 and 12 November, Commissioner nominees with portfolios assigned by President Von der Leyen attended hearings of relevant European Parliament (EP) Committees. The Members of the EP (MEPs) quizzed the nominees about their intentions and plans for the 2024-2029 term. For taxation, key points emerged from Wopke Hoekstra (Netherlands), Commissioner nominee for taxation, climate, net zero and clean growth:

  • Hoekstra committed to working on tax initiatives to help Europe’s competitiveness, prosperity, and social fairness, with a focus on green taxation, closing the tax gap, simplification, and pursuing work that needs to be done internationally

  • he aims to close negotiations on the Energy Taxation Directive and explore further greening of the VAT system

  • he pledged to continue the fight against tax fraud, evasion, and avoidance, expanding the focus beyond the VAT gap

  • streamlining and decluttering tax legislation, in particular the Anti-Tax Avoidance Directive (ATAD) and the Administrative Cooperation Directive (DAC)

  • a holistic effort to declutter tax policies is planned towards 2026, adding that Pillar I and Pillar II, FASTER or BEFIT could be huge parts in this direction

  • on kerosene/aviation tax/levy: the European Commission (EC) could seek a “coalition of the willing” among Member States

  • regarding digital tax/Pillar 1: Hoekstra prefers a global agreement but will consider a pan-EU solution if necessary

  • he emphasised the need to eradicate fossil fuel subsidies by revising the Energy Taxation Directive and building consensus among Member States

  • additionally, he plans to work towards reducing taxes on renewables

New web portal to guide SMEs ahead of 2025 VAT regime changes

The web portal was launched on 12 November to support the new VAT regime for SMEs, which becomes applicable from 1 January 2025 onward. The web portal contains valuable information for SMEs – and their advisors – on what the new rules will be, to whom they are applicable, frequently asked questions and much more.

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Commissioner hearings: tax points from non-tax nominees

In addition to Commissioner nominee Hoekstra (see feature article above), other nominees made tax related commitments in their EP hearings.

Maria Luís Albuquerque (Portugal), Commissioner nominee for Financial Services and the Savings and Investments Union, said the following:

  • more harmonised tax treatment for retail investment products should be explored

Piotr Serafin (Poland), Commissioner nominee for Budget, Anti-Fraud and Public Administration, explained the following:

  • new proposals for EU Own Resources are on the table, and it is essential to persuade Member States to support this direction. Strong preference for new EU own resources over increased Member State contributions to the EU budget

  • Own Resources currently on the table: CBAM, ETS, a Pillar 1 based one, and a statistical-based resource for the corporate sector

MEP Question and Reply

European Commission may consider changes to VAT rules for donated goods

  • Question by MEP Moritz Korner (RE/Germany)

  • Reply by Commissioner Gentiloni

Council

Agreement reached on VAT in the Digital Age (ViDA) proposal

The agreement on ViDA was reached during the ECOFIN meeting of finance ministers on 5 November, following months of deadlock primarily due to Estonia’s objections over the deemed supplier rules.

In summary, ViDA introduces the following key changes:

  • fully digital VAT reporting obligations for cross-border transactions by 2030

  • VAT payment requirements for online platforms on short-term accommodation and passenger transport services in most cases where individual service providers do not charge VAT

  • improved and expanded online VAT one-stop-shops, allowing businesses to avoid costly registrations for VAT in every Member State where they operate

On the deemed supplier rules specifically, a compromise was reached by granting Member States greater flexibility, notably by expanding the definition of short-term accommodation rental for tax purposes and giving Member States the possibility to exempt SMEs from the deemed supplier rules. The Council also agreed on a short transition period for applying these rules.

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Other news

Post-Master EU VAT (in English) – EFS, Erasmus University Rotterdam