EU taxation and customs union ad that the new VAT rules on cross-border business-to-consumer (B2C) e-commerce transactions will come into force on July 1. The following is taken from the ad:
Everyone in the e-commerce supply chain is affected, from online sellers and marketplaces / platforms inside and outside the EU, to postal operators and couriers, to customs administrations and tax, right down to consumers.
Online sellers, including online marketplaces / platforms, can register in an EU Member State and this will be valid for the declaration and payment of VAT on all distance sales of goods and services cross-border services to customers within the EU.
They will benefit from a reduction in paperwork of up to 95% by registering for the new Single Window (OSS).
The existing thresholds for distance selling of goods within the EU will be removed and replaced by a new EU threshold of EUR 10,000. Below this threshold of EUR 10,000, the provision of TBE services (telecommunications, broadcasting and electronics) and distance sales of goods within the EU may remain subject to VAT in the Member State where the taxable person is established.
Special provisions are introduced whereby online marketplaces / platforms facilitating supplies of goods are deemed, for VAT purposes, to have received and delivered the goods themselves (“reputable supplier“).
In addition, new record keeping requirements are introduced for online marketplaces / platforms facilitating the provision of goods and services, including where such online marketplaces / platforms are not a reputable supplier.
The VAT exemption for the importation of small shipments with a value of up to 22 euros will be abolished. This means that all goods imported into the EU will now be subject to VAT.
But help is at hand! A new special system for distance selling of low value goods imported from third territories or third countries will be created. the Import One-Stop-Shop (IOSS) was created to simplify the declaration and payment of VAT.
Finally, simplification measures for distance sales of goods imported in batches not exceeding 150 euros will be introduced, in the event that the IOSS is not used (special provisions).
- Distance sales of goods within the EU by reputable suppliers or suppliers;
- Domestic sales of goods by reputable suppliers;
- Provision of services by EU and non-EU sellers to consumers in the EU;
- Distance sales of goods imported from third territories or third countries by reputable suppliers and suppliers, with the exception of goods subject to excise duty.