Our highlights are:

We strongly support the European Commission’s initiative to improve the VAT system in the EU using digital tools. The VAT system has become increasingly burdensome for businesses, especially those who operate cross-border. A simpler VAT-system, strengthened by using digital tools, has the potential to reduce the administrative burden on companies while increasing the effectiveness of tax and other public administration controls.

Such potential cannot be realised if the implementation of these systems persists with the current level of diversity of approach among jurisdictions. From that perspective, EESPA is in favour of the introduction of a partial or fully harmonised digital reporting system (“DRR”), but caution that political reality has to be taken into account in order to ensure that member states are willing to reform and adhere to the DRR. Part of this will be to allow sufficient time for adaptation.

In what follows we have described our view on the European Commission’s initiative to improve the VAT system in the EU through the introduction of a partial or fully harmonised DRR. Based on the extensive experience of EESPA in this field, we have described how such DRR can be implemented as a ‘holistic’ model that supports the requirements of all stakeholders in a balanced manner – such model is referred to as the “Decentralised CTC (“Continuous Transaction Controls”) and Exchange Model”.

Download the full report:

EESPA on EC VAT in the digital age consultation (67 downloads)