ViDA proposals formally adopted – significant VAT changes
ViDA proposals formally adopted – significant VAT changes
After a consultation of the European Parliament, the VAT in the digital age package (or ViDA-package) has been formally adopted on 11 March 2025. Legislative texts where published, subsequently, on 25 March in the Official Journal of the EU. The package will bring about significant changes in the field of VAT, which will come into application between 2025 and 2035. In this article we give a brief overview of the upcoming changes and their timeline. We will address all three pillars of ViDA separately in different upcoming articles soon.
Member States can impose the obligation to taxable persons established in their territory to issue electronic invoices for supplies of goods and services other than cross-border supplies.
As of 1 January 2027
Preceding the extension of the One Stop Shop (OSS) in 2028 it will be possible to report B2C supplies of electricity, gas, heating and cooling through the OSS. This accommodates in particular the electric vehicle charging industry.
As of 1 July 2028
All Member States have adapted their domestic digital reporting system to the EU format.
Main changes and timeline
Upon entry into forceMember States can impose the obligation to taxable persons established in their territory to issue electronic invoices for supplies of goods and services other than cross-border supplies.
As of 1 January 2027
Preceding the extension of the One Stop Shop (OSS) in 2028 it will be possible to report B2C supplies of electricity, gas, heating and cooling through the OSS. This accommodates in particular the electric vehicle charging industry.
As of 1 July 2028
- Platforms will become responsible for the payment of VAT on short term accommodation rentals and passenger transport by road in cases where the underlying supplier does not remit VAT. Member States can postpone this obligation until 1 January 2030. Member States can also choose to disapply this provision in case the underlying supplier uses the exemption for SMEs (small and medium businesses). Platforms must also record (and provide data on request) about transactions they facilitate in this sector in situations where they are not liable to remit the VAT on these transactions.
- A new place of supply rule will apply to B2C platform facilitation services. These services will be subject to VAT at the place where the underlying service is subject to VAT.
- The number of required VAT registrations of businesses within the EU will decrease because of a new set of rules: (1) extension of the One Stop Shop (OSS) regime, (2) extension of the mandatory reverse charge mechanism and (3) a special regime for the transfer of own goods.
- E-invoicing (using an EU standard) and digital reporting obligations in cross border transactions are introduced. In short, this concerns intra-Community supplies and acquisitions, supplies of goods and services on which VAT is reverse-charged and transfers of own goods. For the supplier, the deadline for issuing an e-invoice and reporting the data to the local tax authorities is ten days after the taxable event. The customer must also report data on the transaction to the local tax authorities, within five days after the receipt of the invoice. The Sales Listing or recapitulative statement will be abolished.
- EU Member States can also introduce digital reporting and e-invoicing obligations for domestic transactions, but this is not mandatory. If they do so, it should be possible to use the EU format. Member States that already have a domestic real-time reporting system in place (or have been authorized to introduce it by the European Commission) on 1 January 2024, have until January 2035 to adapt their system to the EU standard.
All Member States have adapted their domestic digital reporting system to the EU format.