Commission welcomes general approach on VAT in the Digital Age

The European Commission has welcomed the general approach announced by the Council regarding the Commission's proposals on VAT in the Digital Age. The new rules, intended to make the EU VAT system more business-friendly and more resilient to fraud, aim to address challenges arising from the platform economy and to level the playing field for all providers of short-term accommodation and transport services.

The package introduces three key measures:

1. Uniform real-time digital reporting for VAT purposes using e-invoicing for cross-border transactions,
2. Platform operators in the passenger transport and short-term accommodation sectors will become responsible for collecting and remitting VAT to tax authorities, where the underlying supplier does not charge VAT, and    
3. A single VAT registration system for businesses selling to consumers across the EU.

The UK intends to consult on e-invoicing in early 2025.