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VAT: Commission proposals measures to support e-commerce and online businesses in the EU – Update

VAT: Commission proposals measures

This is an update on the progress on the Commission proposals to support online businesses in the EU.


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In December 2016, the Commission unveiled its proposed new measures to support e-commerce and online businesses in the EU. These include a reduced rate for e-books and the extension of Mini One Stop Shop to the supply of goods. Most of these were outlined in the Commission’s Action Plan on VAT. The proposed start date for the equal treatment would be essentially be from when the change is agreed. For some of the threshold simplifications the proposed start date was 2018 and for the remainder 2021. There have been a number of revised legislative proposals on e-books, but there still does not appear to be agreement across Member States. There have been number of meetings on the 2018 and 2021 changes but no further documents have been released. It therefore looks increasingly likely that the start date for these changes is likely to slip. 


The current state of play of these are:

Same reduced VAT rate for e-books as printed equivalents

This proposal has been discussed at three Working Party on Tax Questions (Indirect Taxation - VAT) meetings. Whilst there is broad support, it appears that getting agreement from all Member States has not been easy. An orientation debate in March noted that ‘One Member State was opposed to the proposal, others still had reservations, some Member States requested to broaden the scope of the proposal, and several Member States presented technical comments and remarks.’

There have been four revised proposals, the last three of which are not publicly available. The last publicly available version from 10 March essentially makes two changes. First it provides that:

‘Member States may apply reduced rates lower than the minimum laid down in      this Article or may grant exemptions with deductibility of the VAT paid at the     preceding stage to goods and services referred to in point (6) of Annex III.'


It also tweaks point 6 by excluding at the end ‘publications wholly or predominantly consisting of audible music or video content;’

To access all the documents relating to this proposal click here.

2018 and 2021 changes

These are contained in two proposals. The main proposal sets out the required changes to the VAT Directive and Directive 2009/132/EC on the exemption from value added tax on the final importation of certain goods. The second amends the Implementing Regulations to change the evidence requirements for small businesses. These have been discussed at 10 Working Party meetings but no further documents have been published. 

Summary of the proposals:

Proposed measures include: Proposed date of implementation
Same reduced VAT rate for e-books as printed equivalents Once agreed by all Member States

Simplified rules forthe mini one stop shop (MOSS):

  • €10,000 annual registration threshold for EU businesses; Simplified invoicing rules;
  • Reduced record keeping period; 
  • Single piece of evidence for customer location where annual sales don’t exceed €100,000.
1 January 2021
An extension of the MOSS to cover distance sales of goods and all B2C services 1 January 2021
Further simplified rules for the MOSS: extended submission deadline to 30 days; and retrospective corrections in current returns. 1 January 2018
Removal of ‘low value consignment relief’ for goods (and introduction of a separate scheme for imports of goods from outside the EU where the consignment does not exceed €150) 1 January 2021
Coordinated MOSS audits via the tax authority of the Member State of identification 1 January 2021



For further information please contact:

Karen Killington

Steve Powell


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