Interesų grupė
© © Copyright Teya 2023 EU VAT in the Digital Age Teya’s Response to the Consultation April 2023 Ref. Ares(2023)2448087 - 04/04/2023 Page 2 Teya welcomes the Commission’s proposal to amend the EU VAT Directive and believes that all three pillars of the proposal will make important improvements in the administration of VAT in Europe. These reforms, in Teya’s estimation, will help close the VAT gap while also streamlining and modernising firms’ VAT compliance obligations. Teya supports the digitisation, automation, and harmonisation of Europe’s VAT regime. Ideally, firms will only need to register for VAT purposes in one member state, and will then be able to operate easily across the EU. Digital and even automated reporting and/or generation of invoices to tax authorities can save firms time and provide more certainty of payment and liquidity to tax authorities.
…invoices to tax authorities can save firms time and provide more certainty of payment and liquidity to tax authorities. It would become more difficult for firms to underreport revenue or otherwise commit VAT fraud, and would thus help address the VAT gap. More real-time monitoring and collection of VAT would increase governments’ liquidity and enhance the predictability of tax revenue. About Teya Teya is bringing a one-stop solution to European businesses. Formerly known as SaltPay, Teya combines payment acceptance and business management tools in one ecosystem - including electronic-point-of-sale, merchant account services, a digital loyalty platform, and other software- as-a-service solutions. Teya is headquartered in London, has offices in 15 countries across EMEA, and has 300,000 merchants using its products globally.
…in London, has offices in 15 countries across EMEA, and has 300,000 merchants using its products globally. Teya exists to ensure that every small, medium and growing business in Europe has the opportunity to thrive. Our payments and business management technology is designed to help the people running businesses to take hassle-free payments, manage their business, and find and reward their customers - all on fair terms. We want to free business owners from the everyday complexities and headaches that stop them from being successful. With our commitment to care and innovation, they can feel confident in making the most of every opportunity and experience the joy of running a business.
…can feel confident in making the most of every opportunity and experience the joy of running a business. Page 3 Teya’s Response to EU VAT in the Digital Age Consultation 1st Pillar Modernising VAT reporting obligations, by introducing Digital Reporting Requirements, which will standardise the information that needs to be submitted by taxable persons on each transaction to the tax authorities in an electronic format. At the same time it will impose the use of e-invoicing for cross-border transactions; The removal of the requirement to apply for a derogation in order to introduce digital reporting requirements (DRRs) and e-invoicing requirements would be a positive step because it would make it easier for Member States to digitise their VAT regimes.
…requirements would be a positive step because it would make it easier for Member States to digitise their VAT regimes. However, as the Commission’s proposal highlights, it is important that alongside this change, Europe quickly begins to move towards harmonisation of these DRRs. The more Member States introduce their own national DRRs, and the more developed and sophisticated these systems become, the more costly it might become to transition to a harmonised European regime in the future.1 Teya supports the Commission’s approach of directing Europe towards greater DRR harmonisation by requiring that any DRRs maintained by Member States be interoperable with a European standard, and that all Member States accept digital reporting following the European standard.
…with a European standard, and that all Member States accept digital reporting following the European standard. The result of this should be convergence over time on a European standard, which tax software providers will be able to work with in order to develop products for a pan-European audience that will facilitate increasingly accurate and efficient tax compliance – to the benefit of both firms and tax authorities. Removal of Article 232 Teya supports the removal of Article 232, allowing firms to fully digitise their VAT invoices. The current framework could lead to inefficient outcomes where firms that do most of their invoicing digitally are required to establish and maintain an ability to deliver paper invoices, even for a small number of clients.
…are required to establish and maintain an ability to deliver paper invoices, even for a small number of clients. Generally, paper invoices should only be allowed on an exceptional basis, due to a variety of drawbacks they present, including inconsistency with the logic of near-real-time recording and transmission of VAT data. Article 263 Teya wishes to stress its support for the Commission’s acknowledgement, in Article 263, of the importance of allowing for the emergence of third-party providers specialising in facilitating the communication of transaction data to tax authorities. Though it is important, as Article 263 states, that government provide some means to submit the required information, creating space for the 1 It becomes more costly to the extent that the sunk cost of the investment in establishing the existing system must be discarded.
…more costly to the extent that the sunk cost of the investment in establishing the existing system must be discarded. Page 4 private sector to contribute could help foster competition and innovation in the development of the necessary solutions. Article 266 Teya supports the removal of Article 266, an important step in ensuring that Member States coordinate to determine the information they need in order to manage their VAT administration, and firms are able to carry out their VAT compliance consistently across Europe. Replacement of Recapitulative Statements with Digital Reporting System Teya supports the move from recapitulative statements to transaction-by-transaction data, allowing tax authorities to compare the supply and acquisition of goods within the EU in order to combat fraud and underpayment of VAT.
…to compare the supply and acquisition of goods within the EU in order to combat fraud and underpayment of VAT. The move toward e-invoicing and automatic, real-time transmission of transaction data to tax authorities can be complemented by the expansion of online cash register (OCR) programs. Together, these initiatives can decrease the effectiveness of cash as a tax-avoiding instrument. Incidentally, this could help minimise the impact of a significant distortion on the competition between payment instruments in Europe. The usefulness of cash as a means to underpay tax should not be a force holding back the modernisation of payments in Europe.
…of cash as a means to underpay tax should not be a force holding back the modernisation of payments in Europe. 2nd Pillar Addressing the challenges of the platform economy, by updating the VAT rules applicable to the platform economy in order to address the issue of equal treatment, clarifying the place of supply rules applicable to these transactions and enhancing the role of the platforms in the collection of VAT when they facilitate the supply of short- term accommodation rental or passenger transport services. Teya does not have any specific comments to add on the subject of the second pillar – updating VAT rules to appropriately treat the platform economy – but broadly finds this change reasonable.
…pillar – updating VAT rules to appropriately treat the platform economy – but broadly finds this change reasonable. 3rd Pillar Avoiding the need for multiple VAT registrations in the EU and improving the functioning of the tool implemented to declare and pay the VAT due on distance sales of goods, by introducing Single VAT Registration (SVR). That is, improving and expanding the existing systems of One-Stop Shop (OSS)/Import One-Stop Shop (IOSS) and reverse charge in order to minimise the instances for which a taxable person is required to register in another Member State. Page 5 Teya supports these important changes which will help to strengthen the European single market and save time for both firms and tax authorities.
…changes which will help to strengthen the European single market and save time for both firms and tax authorities. We welcome the Commission’s proposed modification to Article 194, requiring that Member States accept the application of the reverse charge mechanism for B2B transactions where a supplier that is not established for VAT purposes in the Member State in which VAT is due makes supplies of goods to a person who is identified for VAT in that Member State. This will allow firms to have fewer regulatory points of contact. Proposal for a regulation - COM(2022)703, amending Regulation 904/2010 Finally, Teya supports the Commission’s concurrent proposal to amend Regulation 904/2010 in order to introduce a new central system for the exchange of VAT information between Member States’ tax administrations.
13 → 12