VAT reporting: fully digitalised by 2030

The Council of the European Union (EU) adopts a package of laws on value added tax. They will make changes to three different aspects of the VAT reporting system. The aim is to make the rules fit for the digital age in which we live.

• By 2030, VAT reporting obligations for companies selling goods and services to businesses in another EU Member State are expected to be fully digitised.

• Online platforms will have to pay VAT on short-term accommodation rentals and passenger transport services when individual service providers do not charge VAT.

• The online one-stop shop for VAT will be improved and extended. Businesses will thus not have to go through costly VAT registrations in each EU Member State where they operate.

The Official Journal of the European Union will publish the legislative package. The Regulations are directly applicable. EU Member States will have to transpose the Directive into their national laws.

The authorities have also approved the conclusions on the tax simplification and tax procedures programme. They reflect the views of the Council and provide guidance for possible future initiatives in the area of taxation. The main objective is to improve EU competitiveness and reduce the administrative and regulatory burden on business.

An in-depth analysis of the EU legislative framework is forthcoming. The European Commission will then have to consult and present an action plan and a roadmap for its implementation with a concrete timetable, by the end of autumn 2025 at the latest.

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