Two of the largest associations supporting EU e-Commerce traders, namely E-Commerce Europe and EuroCommerce, have submitted a letter to Mr Vincent Van Peteghem, the Belgian Minister of Finance, in which they urge the timely implementation of the Single VAT Registration (“SVR”) element of the VAT in the Digital Age package (“ViDA”).

It was hoped that the ViDA draft legislation would already have been approved last year in its entirety, but the ratification of same has been delayed. As a result, it is widely expected that the timeline for the introduction of the new VAT changes will be pushed out, with the SVR element provisionally not coming into force until 2026 (one year later than originally planned).

Belgium’s’ 6 month presidency of the Council of the European Union began on 1st January 2024, and it is understood that there will be a strong drive to have the ViDA package approved before June of this year, with discussions on same scheduled with EU Member States on 14th May 2024.

E-Commerce Europe and EuroCommerce have made a strong argument for the speedy introduction of the SVR, highlighting the importance of this for the EU E-Commerce sector. In particular, SME are most impacted by the burden of the high VAT compliance costs associated with expanding their business within the EU, especially when trading via marketplaces, and holding stock in EU Member States outside of their own country of establishment.

The SVR would be extended to include the reporting of certain transactions, not previously covered when the One-Stop-Shop (“OSS”) was implemented on 1st July 2021 thus removing the need for multiple EU VAT registrations. A further component of the SVR is the mandatory application of the extended reverse charge on domestic B2B sales of goods made by a foreign supplier. This will not only remove the current lack of unity regarding the application of the extended reverse charge among Member States, but more importantly, will contribute further to simplifying VAT obligations, again reducing compliance costs for traders within the EU.

The authors of the letter have also suggested the removal of the section of legislation surrounding the mandatory implementation of the Import One-Stop-Shop (“IOSS”) from ViDA, since it is understood that this part of the package will cause further delays. Instead, the IOSS expansion should be included in the planned EU customs legislation overhaul.

Whether the E-Commerce industry will see the introduction of the SVR by January 2025 remains unclear, but it has been heavily stressed that the sooner this is implemented, the better, with a delay of maximum one year only.
We will keep you updated on any further developments on this topic.