On 8 May 2020, the European Commission (EC) issued a press release announcing proposals to defer certain deadlines for filing and exchanging information under the amended EU Directive on Administrative Cooperation (DAC 2 and DAC 6) by three months and to postpone the entry into application of the VAT e-commerce package by 6 months. This addresses the difficulties that businesses and member states are currently facing due to the Covid-19 crisis.
The initiative comes in the form of a directive amending the DAC:
New timeline under EC proposal
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The EC also proposes an option to further extend the deferral period once for a maximum of three additional months, if during the initial period of deferral the exceptional circumstances of severe risks for public health caused by the Covid-19 pandemic persist and the EU member states are forced on implementing lockdown measures.
The European Commission proposes a council regulation amending Directive 2017/2455 and (EU) 2019/1995 Directive, and a council decision amending Regulation 2017/2454. Both texts have as the objective to defer the entry into force of e-commerce related measures.
Consequently, the VAT e-commerce package should apply as of 1 July 2021 instead of 1 January 2021.
The EC proposals mentioned above are subject to approval of the EU Parliament and Ecofin Council (Economic and Financial Affairs Council).
The amendment of DAC must be implemented by EU member states into their domestic law by 31 May 2020 at the latest based on the EC’s proposal.
This implies that the law voted of 25 March 2020 implementing DAC 6 (see our tax alert) will have to be duly amended. It remains to be confirmed that the start date for notification obligations of intermediaries covered by legal professional privilege would also be deferred until 1 October 2020.
As mentioned above, it also remains to be checked whether, as a result of the DAC 2 amendment, the Luxembourg tax authorities will also postpone the deadline for the CRS reporting for Luxembourg financial institutions beyond 30 June 2020, i.e. 30 September 2020.
This deferral of tax filing and reporting deadlines should be more than welcomed by the business community. As far as DAC 6 is concerned, both intermediaries and taxpayers will have more time to adapt to the new rules but should still continue to actively review their reportable arrangements. KPMG provides tailor-made assistance to get you DAC 6 ready, including our innovative MDR IT solution – KPMG DAC 6 Processor – to help you categorize arrangements, monitor deadlines and streamline the reporting process based on EU-wide domestic rules.
 aim at making the electronic platforms liable for the payment of the VAT and informing Member States through the exchange of the related information
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