On 4 October 2017, the European Commission proposed a drastic reform of the VAT system of the European Union to modernise the VAT system and make it simpler and more business-friendly for the benefit of both Member States and businesses. In the short term, the European Commission has also proposed a number of ‘quick fixes’ to improve the VAT system. These will be effective as of January 2020.
MAIN CHANGES FROM 2020: ‘QUICK FIXES’
The European Commission introduces four ‘quick fixes’, which will be effective as of January 2020:
- Simplification and harmonisation of call-off stock regulation, i.e. stock that a supplier holds in a Member State where it is not established, so that it can be sold quickly to local customers on a call-off basis. Some countries have a simplification arrangement for this, which avoids compulsory registration in the country where the stock is held; other countries do not have an arrangement of this kind. As of January 2020, there will no longer be a need to VAT register in the corresponding member state.
- Clarifying the rules to prove the transport of goods in case of intra EU supplies (B2B) with required evidence.
- Acquiring a VAT identification number becomes a condition to apply the 0% VAT rate on intra EU supplies (B2B). Based on this case law, this number is currently not a substantive condition, but this will consequently be changed.
- Simplifying the rules for triangular supplies with an assumption. It will be easier to determine which transaction in a chain transaction or triangular transaction is defined as the cross-border supply.
HOW CAN MAZARS BE OF ASSISTANCE?
Mazars’ VAT specialists can help you with the implementation of these ‘quick fixes’ in your day-to-day business. Furthermore, Mazars offers a VAT number check to verify the validity and correctness of a large number of VAT numbers.
WANT TO KNOW MORE?
Do you want to know more about these ‘quick fixes’ or the reform of the EU VAT system? Register to our webinar 'Upcoming changes in the World of VAT 2020" or contact one of our specialists to learn more.