EU Consultation Against VAT Fraud

EU Consultation Against VAT Fraud  :   A consultation has been issued as from 02.03.2017 to 31.05.2017 and concerns the following:  Last year the Commission adopted an Action Plan towards a robust single European VAT area in relation to the definitive VAT system for cross-border supplies.  As such, several VAT aspects will need to be examined, such as the administrative cooperation and the fight against VAT fraud, the existing special rules for small enterprises (SMEs) and the VAT rates which can be applied by Member States.   It is further proposed for a common and modern policy on the governance of VAT rates across Europe.

EU Consultation Against VAT Fraud

 The administrative cooperation and the fight against VAT fraud concerns tax administrations as well as businesses and citizens in the EU. Since VAT fraud affects the national and EU budgets it may negatively impact the amount of resources available for public policy objectives. To tackle cross-border VAT fraud, Member States are forced to incorporate additional reporting obligations and checks for cross-border trade which is capable of disturbing the proper functioning of the single market. These arrangements also concern Businesses providing the means to check the validity of VAT identification numbers of businesses established in other Member States, the ‘VIES on-the-web service’.  Furthermore, businesses can be audited on the basis of information or requests from other Member States. There is an aim by the European Commission to to update the rules governing the administrative cooperation and the fight against cross border VAT fraud.  This has purpose of improving the functioning of the single market and tackling the heavy losses to the Member States and EU revenues. This is currently governed by Council Regulation (EU) No 904/2010 of 7 October 2010.

 Purpose of consultation

The purpose of issuing this consultation paper is to gather views from stakeholders about their experience of the current rules governing administrative cooperation and fight against cross-border fraud in the field of VAT; In addition there is a need to bring new insights for the on-going evaluation of Regulation (EU) 904/2010 and also to provide information about possible improvements including ‘VIES on-the-web’. Furthermore, to collect quantitative data on possible reduction or increase of regulatory costs/benefits for businesses.  Tax administrations will be able to submit their opinion via a specific questionnaire until 31.05.2017.