OECD says e-commerce marketplace should be responsible for collection of VAT/GST

Mar 25, 2019

OECD proposals to make e-commerce marketplaces liable for the VAT/GST on sales made by online traders through their platforms were endorsed by delegates from over 100 jurisdictions at the Global Forum on VAT conference recently held in Australia. Other measures proposed at the Forum include data sharing and enhanced co-operation between tax authorities and online marketplaces.

Approximately 300 participants met in Melbourne, Australia on 20-22 March 2019 and discussed measures proposed in a new report by the OECD on The Role of Digital Platforms in the Collection of VAT/GST on Online Sales. According to OECD analysis, two-thirds of all cross-border e-commerce sales of goods are made via online marketplaces.

Changing tax rules to make e-commerce marketplaces liable for the VAT/GST on sales made by online traders through their platforms, will allow tax authorities to focus their compliance efforts on the relatively small number of marketplaces rather than on the millions of small traders operating through them according to the OECD.