This change , carried out on July 1, affects the payment of VAT (European basic tax) on the purchase of products or services sold online. A tax that until now some companies and platforms from countries outside the EU were exempt from.
What are the new VAT rules for e-commerce?
Firstly, the VAT exemption (in force since 1993) on the import of goods with a value of no more than EUR 22 is being removed. From 1 July, all goods imported into the EU will be subject to VAT. This means that companies importing from outside the EU will no longer receive line database preferential treatment compared to goods purchased within the EU. VAT will have to be paid in the country where the goods and services are consumed.
To streamline the process, businesses are offered a simple and uniform system to declare and pay their VAT obligations through two new online systems: the VAT One-Stop Shop (OSS) or the Import One-Stop Shop (IOSS).
Objectives of the new VAT rules for e-commerce.
According to experts, this reform responds to the real needs of e-commerce , which has increased significantly as a result of the pandemic. This is what the new regulation seeks:
Balancing tax payments between EU and non-EU companies. Before the regulations, the latter had an advantage.
To offer businesses a simple and uniform system to declare and pay their VAT taxes. This can be done through two online systems: the VAT one-stop shop or the import one-stop shop.
Greater transparency in processes increases payment and reduces fraud.
EU citizens will see their public revenues increase by €7 billion a year.
What changes for the consumer?
Are you an online consumer? Don't worry, the law doesn't affect your purchasing habits. If the seller uses the Single Window for Imports (IOSS), you won't have to pay additional customs charges if you buy from companies that import from outside the EU.
With the new regulations, you can be sure of the final price you pay online. This way, you won't have to pay any surprise taxes upon delivery, whether the product or service comes from within or outside the EU.
