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EU Parliament backs harmonised e-invoicing and definitive VAT system

Anti-VAT fraud initiatives get Parliament vote

The European Parliament voted on 16 February 2022 in favour of harmonising pan-EU e-invoicing and supporting the adoption of the definitive VAT system reform to:

  • facilitate cross-border interoperability;
  • ensure legal compliance;
  • increase transparency in commercial transactions; and
  • limit fraud and errors.

The Parliament acknowledged that member states are already adopting various forms of e-invoicing and live reporting. But that this should be coordinate to promote ease of adoption by businesses and efficient exchange of tax data.  Any parliamentary vote is non-binding on member states of the EU.

Other measures backed by Parliament tied to the 2019 EU Tax Action Plan and EU VAT reforms:

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Switch to definitive VAT system

The Parliament restated its support for the reforms of the current ‘temporary’ origin-based VAT rules for B2B goods transaction. This was open to criminal fraudsters using the zero-rating intra-community supply process to collect billions in VAT.  And creates complexity and costs for law-abiding businesses. The 2018 draft definitive VAT regime proposes to move to a destination-based model, supported by easier ways to report and remit that VAT.  However, many member states have objections to the proposal which is effectively blocked.

EU digital reporting requirements proposals

EU VAT in the Digital Age reforms include a channel for harmonised Digital Reporting Requirements (DRR) and  Continuous Transaction Controls (CTC)

by EU states. This grew from the 2020 EU Tax Action Plan  proposals for a fairer and more efficient EU tax regime.

EU VAT reforms

Reform (click for details) Update
Contact VATCalc to learn how our single VAT determination, reporting and e-invoicing platform can help you manage and thrive with global compliance change
2030? Digital Reporting Requirements and e-invoicing harmonisation Likely delay to 2030
Structured e-invoices supercede paper invoices Likely delay to 2030
EC Sales lists replaced by Digital Reporting Requirements Likely delay to 2030
2028 EU Customs reforms Published May 2023
€150 import consignment threshold removed Published May 2023
2026 DAC8 harmonised crypto asset reporting Approved May 2023
2025 VAT registration thresholds equivalence foreign businesses 1 Jan 2025
Virtual events VAT rule changes 1 Jan 2025
Single VAT Registration in the EU - extension of OSS Likely delay to 2026
Marketplace deemed supplier extended to EU sellers Likely delay to 2026
Proposal for VAT treatment of the platform economy Likely delay to 2026
EU IOSS mandated for marketplaces Likely delay to 2026
Call-off stock VAT simplification ends Likely delay to 2026
Harmonisation of B2B Reverse Charge rules Likely delay to 2026
Financial Services VAT exemption reform proposals Consultation complete; proposal awaited
Tour operator margin scheme VAT reforms EC undertaking fresh review
2024 Payment providers' seller transaction reporting and bookkeeping obligations In effect since 1 Jan 2024
2023 DAC 7 - marketplace reporting harmonisation In effect since 1 Jan 2024
2022 IOSS reforms to prevent double taxation On hold
EU reduced VAT rate freedoms Entered into force 6 April 2022
VAT in the Digital Age proposals Published Dec 2022
EU DAC8 cryptocurrency tax reporting proposals Published Dec 2022
VAT Gap Initiative Q3 2022
EU Definitive VAT System On hold
2021 One-Stop-Shop (OSS) single EU VAT return In effect since 1 July 2021
Ending €22 import VAT exemption; new IOSS return In effect since 1 July 2021
Marketplace deemed supplier EU VAT reforms In effect since 1 July 2021
2020 EU four Quick Fixes for VAT In effect
Tax authorities anti-VAT fraud cooperation In effect
Tax Action Plan - 25 VAT and other tax reforms roadmap See 'VAT in the Digital Age' and others
2019 Simplification of e-services VAT compliance and thresholds In effect
Single and multi-use vouchers In effect
2018 Lower e-book and publications VAT rates In effect, although not all EU states have adopted the option


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