The German federal cabinet at the end of July 2019 approved the government’s draft bill that would implement EU “quick fixes” for the value added tax (VAT) treatment of chain transactions in the European Union, among other measures. It is proposed that the measures would have an effective date of 1 January 2020.
Implementation of the “quick fixes” in German VAT law concerns:
Additional VAT changes to be effective beginning 1 January 2020 concern the VAT exemption of cost-sharing alliances; the so-called “export over the shop counter” rule; the input VAT refund procedure; restrictions in the input VAT deduction for traders who are not residents of the EU; obligations of fiscal representatives; repeal of § 25d German VAT law (liability); and rejection of input VAT deduction and zero-rating in the instances when there is participation in tax evasion.
The VAT changes also include a new place of benefits-in-kind, the reduced VAT rate for e-books, and changes regarding travel services.
Read an August / September 2019 report [PDF 333 KB] prepared by the KPMG member firm in Germany.
Other recent VAT developments that may affect businesses in Germany include the following items:
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.