Action Plan on VAT adopted by European Commission

29 April 2016

During April 2016 the European Commission approved an action plan which sets out actions to tackle VAT fraud, adapt the EU VAT system to the digital economy and to further consider the VAT obligations on small and medium enterprises.

It is hoped that this will help to steer the EU towards a robust single European VAT area in relation to cross-border supplies and also proposes options for a new policy on EU rules governing VAT rates.

If implemented this could mean the abolishment of zero-rating on intra-community supplies of goods between businesses and these types of transactions will instead be subject to VAT in the country of sale.