The European Council recently agreed on a set of rules to facilitate detection of tax fraud in cross-border e-commerce transactions. The new rules will enable member states to collect e-records of payment service providers like banks. A central system will also be set up for storing the payment information and its processing by national anti-fraud officials.
This set of new rules consists of two legislative texts: First, amendments to the value-added tax (VAT) directive putting in place requirements on payment service providers to keep records of cross-border payments related to e-commerce. This data will then be made available to national tax authorities under strict conditions, including those related to data protection.The European Council recently agreed on a set of rules to facilitate detection of tax fraud in cross-border e-commerce transactions. The new rules will enable member states to collect e-records of payment service providers like banks. A central system will also be set up for storing the payment information and its processing by national anti-fraud officials.#
Second are amendments to a regulation on administrative cooperation in the area of VAT. These amendments set out the details of how national tax authorities will cooperate in this area to detect VAT fraud and control compliance with VAT obligations, according to a press release from the European Union (EU).
These rules complements the VAT regulatory framework for e-commerce coming into force in January 2021 that introduced new VAT obligations for online marketplaces and simplified VAT compliance rules for online businesses.
These rules should be formally adopted by the European Council without further discussion once the text undergoes a legal and linguistic review.
Fibre2Fashion News Desk (DS)
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