VAT News

EU-Opposition to e-commerce proposals

In proposals first launched in 2016, the EU seeks to make changes to VAT legislation in attempt to simplify VAT compliance in the e-commerce industry.

One of the key components of the proposals was to make the e-commerce selling platforms, such as Amazon and Ebay liable in some way for remitting VAT due on imported goods, thus reducing non-compliance by non-established traders, and reducing administration for the tax authorities.

Whilst it has been suggested that the platforms could be responsible for declaring VAT on these goods, both Amazon and Ebay are said to oppose this.

Amazon are reported to be taking the approach of a withholding or split payment system could be operated so that traders effectively pay tax due automatically. Ebay on the other hand wholly oppose any such plans to involve platforms in the compliance process, and indeed see the proposals as largely negative for small businesses, also citing a lack of economic impact assessments.

Discussion around the proposals is ongoing, and full agreement between the EU member states would be needed to implement any legislative changes. At a recent meeting the idea of a withholding scheme was rejected by some member states, and it would seem that there is some way to go until agreement is reached.

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