ViDA focuses on improving VAT efficiency, minimising VAT fraud and reducing foreign VAT registration obligations. Thereto, the new rules will introduce digital reporting requirements for cross-border transactions, require platforms to pay VAT on short-term accommodation rental and passenger transport services and will expand existing VAT simplification schemes to minimise foreign VAT registration obligations for businesses.

The measures introduced in the ViDA proposal will impact all businesses and particularly those carrying out cross-border transactions and platform companies. Businesses will have to amend their invoicing and VAT reporting processes. Businesses will further have to assess whether their foreign VAT registrations are still required due to ViDA. ViDA also introduces new obligations and liabilities for platforms that facilitate supplies of goods. Businesses offering passenger transport by road and short-term accommodation rental through platforms and platforms that facilitate these services will also have to apply new VAT rules.

As a next step, ViDA will have to be implemented by the Member States.

What are the changes?

The ViDA proposal consists of three pillars: (1) digital reporting requirements (2) the single VAT registration and (3) the VAT treatment of the platform economy.

Please contact our dedicated VAT specialists for advice on your situation.