Changes from report parliamentary committee draft to plenary report

AddedRecital 35 a (new): (35a) IOSSs should operate transparently and securely. A unified approach between the IOSS, on the one hand, and customs legislation and practice, on the other, would help bring an end to inconsistencies, errors and double taxation.

AddedRecital 36: (36) In order to ensure uniform conditions for the implementation of Directive 2006/112/EC, powers should be conferred on the Commission to better secure the correct use and the verification process of IOSS VAT identification numbers for the purposes of the exemption provided for in that Directive. This empowerment should allow the Commission to adopt an implementing act to introduce special measures to prevent certain forms of tax evasion or avoidance. Such special measures involve, inter alia, linking the unique consignment number with the IOSS VAT identification number. Those powers should be exercised in accordance with the examination procedure referred to in Article 5 of Regulation (EU) No 182/2011 of the European Parliament and of the Council71 and for this purpose the committee should be the one established by Article 58 of Regulation (EU) No 904/2010 of the European Parliament and of the Council72. The Commission’s powers should take into account taxpayers’ rights to confidentiality. Any draft implementing act is to be transmitted to the European Parliament for information, in order to enable the exercise of its rights.

AddedRecital 38: (38) Directive 2006/112/EC provides for a simplified VAT treatment of goods transferred under call-off stock arrangements where certain prescribed conditions are met. As the OSS simplification scheme for transfers of own goods is comprehensive and encompasses cross-border movements of goods that are currently covered by call-off stock arrangements under article 17a of that Directive, it is necessary to phase out these arrangements by including an end date prior to the complete removal of the call-off stock provisions in Directive 2006/112/EC. Therefore, an end date of 31 December 2025 should be laid down, after which it will no longer be possible to effect any new call-off stock arrangements. For call-off stock arrangements commencing on or before 31 December 2025, the relevant conditions, including the 12 month time limit for transferring ownership of those goods to the intended purchaser, should continue to apply. In parallel with the inclusion of this new end date, a new paragraph should be inserted in the provisions pertaining to call-off stock arrangements to ensure that those arrangements will cease to apply on 31 December 2026, as they will no longer be required after that date.

AddedRecital 39: (39) The margin scheme operates by allowing taxable dealers to pay VAT on the difference between the sale price and the purchase price of goods covered by the scheme namely second-hand goods, including capital goods such as buildings, machinery, tools and equipment, works of art, collectors' items and antiques. To ensure that the taxation of those specific supplies occurs in the Member State where the customer is established, has his or her permanent address or usually resides, Directive 2006/112/EC should be amended to introduce a new place of supply rule. In addition, Directive 2006/112/EC should be amended to specifically exclude supplies of margin scheme goods from the mandatory application of the reverse charge mechanism. However, to support the objective of a single VAT registration in the Union, and to minimise compliance burdens, taxable dealers that operate under the margin scheme can opt to register to use the Union OSS scheme to declare and pay the VAT due on certain supplies of margin scheme goods via that scheme, without the need to register in multiple Member States.

AddedRecital 39 a (new): (39a) Recognising the importance of sustainable practices, it is important to ensure that the method for calculating VAT on the profit margin for the sale of second-hand and collectible goods is simple and clear. The Union should consider whether other calculation methods (for example, an average VAT margin rate provided by the seller and by category of objects) are needed in order to improve the application and workings of the VAT margin scheme for second-hand goods.

AddedRecital 39 b (new): (39b) Some Member States do not exempt in-kind donations from VAT, even though such an exemption is possible under the existing VAT Directive, leading businesses to destroy consumer goods, notably returns, rather than donating them to charitable causes. The Commission should issue guidance to Member States, clarifying that VAT exemptions for in-kind donations are compatible with existing Union VAT law.

AddedRecital 41 a (new): (41a) Implementing digital reporting requirements in the markets of all Member States simultaneously in 2028 will be extremely challenging. A progressive implementation of the digital reporting requirements would ensure the availability of sufficient qualified personnel for the adaptation of all businesses software. Practical solutions to reduce implementation costs should be proposed by the Commission to businesses before the implementation of this Directive.

AddedRecital 41 b (new): (41b) The package ‘VAT in the Digital Age’ should be phased in as from 1 January 2025.

AddedRecital 41 c (new): (41c) The European Data Protection Supervisor was consulted in accordance with Article 42(1) of Regulation (EU) 2018/17251a and delivered an opinion on 3 March 20231b. / 1a Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295, 21.11.2018, p. 39). / 1b OJ C 113, 28.3.2023, p. 26.

AddedRecital 41 d (new): (41d) The expansion of cloud computing services, as a result of digital reporting requirements, could lead to an increase in greenhouse gas emissions. The Commission should take measures and provide incentives to ensure the ‘greening’ of the digital sector, for example by centralising data centres to optimise their functioning, by helping companies to use renewable energies instead of fossil fuels to power their data centres and by using artificial intelligence to reduce their pollution.

AddedRecital 41 e (new): (41e) This Directive encompasses several changes in the way VAT revenues are to be declared. It might have a significant impact on the nature of the work of tax administrations’ employees. Tax authorities should therefore ensure that their employees have access to the necessary training prior to the entry into force of this Directive.

AddedArticle 1 – title: Amendments to Directive 2006/112/EC with effect from 1 January 2025

AddedDirective 2006/112/EC

AddedArticle 1 – paragraph 1 – point 6, Article 217: For the purposes of this Chapter, ‘electronic invoice’ means an invoice that contains the information required by this Directive, and which has been issued, transmitted and received in any electronic format. / For the purposes of Title XI, Chapter 6, Sections 1 and 2 , ‘electronic invoice’ means an invoice that contains the information required by this Directive, and which has been issued, transmitted and received in a structured electronic format that allows for its automatic and electronic processing.

AddedDirective 2006/112/EC

AddedArticle 1 – paragraph 1 – point 7, Article 218 – paragraph 1: 1. For the purposes of this Directive, Member State shall accept documents or messages on paper, in a digital format or in electronic form as invoices if they meet the conditions laid down in this Chapter.

AddedDirective 2006/112/EC

AddedArticle 1 – paragraph 1 – point 7, Article 218 – paragraph 2: 2. Member States may impose the obligation to issue electronic invoices. Member States imposing this obligation shall allow for the issuance of electronic invoices which comply with the European standard on electronic invoicing and the list of its syntaxes pursuant to Directive 2014/55/EU of the European Parliament and of the Council*. Member States may also allow the issuance of electronic invoices in a different format, in accordance with Article 217 of this Directive, as long as they also allow the use of the European standard. For domestic transactions, Member States may oblige taxable persons established within their territory to issue electronic invoices for supplies of goods and services within their territory.

AddedDirective 2006/112/EC

AddedArticle 1 – paragraph 1 – point 7, Article 218 – paragraph 2 a (new): 2a. The European standard on electronic invoicing referred to in paragraph 2 of this Article shall be published on the website of the Commission.

AddedDirective 2006/112/EC

AddedArticle 1 – paragraph 1 – point 7, Article 218 – paragraph 2 b (new): 2b. Micro-undertakings and small undertakings as defined in Directive 2013/34/EU and non-profit entities may use standards recognised and in force in the Member State other than the standard provided for in Directive 2014/55/EU, as long as those standards comply with Article 217 of Directive 2006/112/EC.

AddedDirective 2006/112/EC

AddedArticle 1 – paragraph 1 – point 9, Article 232: (9) Article 232 is replaced by the following:

AddedDirective 2006/112/EC

AddedArticle 1 – paragraph 1 – point 9, Article 232: 1. Until 31 December 2027, the use of an electronic invoice shall be subject to acceptance by the recipient for the acquisition of goods carried out in accordance with Article 20 and for supplies of a service that is taxable in a Member State other than the Member State in which the supplier is established. / From 1 January 2028, the use of an electronic invoice shall not be subject to acceptance by the recipient for the acquisition of goods carried out in accordance with Article 20 and for supplies of a service that is taxable in a Member State other than the Member State in which the supplier is established. / 2. For remaining acquisitions and supplies of goods and services that are not referred to in paragraph 1, Member States may provide that the use of electronic invoices issued by taxable persons established within their territory shall not be subject to the acceptance of the recipient established in their territory.

AddedArticle 2 – title: Amendments to Directive 2006/112/EC with effect from 1 January 2026

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 2 – point a, Article 14a – paragraph 2: 2. Where a taxable person facilitates, through the use of an electronic interface such as a marketplace, platform, portal or similar means, the supply of goods within the Community by a taxable person, the taxable person who facilitates the supply shall be deemed to have received and supplied those goods. The presumed provider may plead good faith and not be liable in the event that an underlying supplier deliberately fails to declare that he or she is not a taxable person.

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 2 – point b, Article 14a – paragraph 3: 3. Where a taxable person facilitates, through the use of an electronic interface such as a marketplace, platform, portal or similar means, the transfer of goods to another Member State in accordance with Article 17(1) by a taxable person, the taxable person who facilitates the transfer shall be deemed to have received and supplied those goods. The presumed provider may plead good faith and not be held liable in the event that an underlying supplier deliberately fails to declare that he or she is not a taxable person.

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 2 – point b, Article 14a – paragraph 4 a (new): 4a. Member States shall prepare and make available dedicated guidance for those individuals listed in Article 28a of this Directive who opt to register as taxable persons, following the introduction of the deemed supplier regime in the accommodation and passenger transport sectors in the platform economy.

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 2 – point b, Article 14a – paragraph 4 b (new): 4b. The Commission shall commission an independent study after 31 December 2027, to assess whether the rules regarding deemed suppliers have been successful and if so to identify new sectors in a similar situation, as well as to assess the advantages and disadvantages of making IOSS mandatory. It shall submit this study to the European Parliament and to the Council.

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 3, Article 28a – paragraph 1 – introductory part: Notwithstanding Article 28, a taxable person who facilitates, through the use of an electronic interface such as a platform, portal, or similar means, the supply of short-term accommodation rental, as referred to in Article 135(3), or passenger transport by road within the Union, shall be deemed to have received and supplied those services themselves where the person providing those services is one of the following:

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 3, Article 28a – paragraph 1 – point f: deleted

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 3, Article 28a – paragraph 1 a (new): The deemed supplier scheme as provided for in the first paragraph shall not apply to platforms which are small undertakings in the sense of Directive 2013/34/EU1a. / Moreover, the first paragraph shall not apply to passenger transport services or to the supply of short-term accommodation rental facilitated through the use of an electronic interface where a passenger transport service or a short-term accommodation rental provided by a person described in the first paragraph and not facilitated through the use of an electronic interface, would not be subject to VAT. / 1aDirective 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ L 182, 29.6.2013, p. 19).

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 4, Article 35: (4) Article 35 is replaced by the following:

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 4, Article 35: Article 33 shall not apply to supplies of second-hand goods, as defined in Article 311(1), point (1), nor to supplies of second-hand means of transport, as defined in Article 327(3), subject to VAT in accordance with the relevant special arrangements.

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 6, Article 46a: deleted / (deleted) / (deleted)

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 7, Article 135 – paragraph 3: 3. The following shall be regarded as having a similar function to the hotel sector: / (a) the uninterrupted rental of accommodation for a maximum of 31 nights with or without the provision of other ancillary services; / (b) the provision of three or more ancillary significant services during the rental of accommodation.

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 10, Article 143 – paragraph 1a – subparagraph 1: For the purposes of the exemption provided for in paragraph 1, point (ca), the Commission shall adopt an implementing act to introduce special measures to prevent certain forms of tax evasion or avoidance by, inter alia, linking the unique consignment number with the corresponding VAT identification number as referred to in Article 369q. It shall inform the European Parliament, EPPO, OLAF and Europol thereof.

AddedArticle 2 – paragraph 1 – point 12, Article 2006/112/EC, Article 194 – paragraph 1: 1. Without prejudice to Articles 195 and 196, where the taxable supply of goods or services is carried out by a taxable person who is not identified for VAT purposes in the Member State in which the VAT is due, the taxable person liable for payment of VAT shall be the person to whom the goods or services are supplied if that person is already identified for VAT purposes in that Member State.

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 12, Article 194 – paragraph 1 a (new): 1a. Notwithstanding paragraph 1, non-established businesses shall be able to register and account for local VAT if they choose to do so.

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 12, Article 194 – paragraph 2 a (new): 2a. By 31 December 2028, the Commission shall assess the effectiveness of this Article and its added value in combating VAT fraud, namely missing trader fraud, duly informing the Parliament and the Council of the results of that assessment.

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 14 – point a, Article 242a – paragraph 1a: 1a. Where a taxable person facilitates, through the use of an electronic interface such as a platform, portal or similar means, the supply of short-term accommodation rental or passenger transport services by road within the Union, and that person is not considered to have received and supplied those services themselves under Article 28a, the taxable person who facilitates the supply shall be obliged to keep records of those supplies.;

AddedDirective 2006/112/EC

AddedArticle 2 – paragraph 1 – point 14 – point b, Article 242a – paragraph 2 – subparagraph 2: Those records shall be kept by the taxable person concerned for a period of seven years from the end of the year during which the transaction was carried out.;