Considerations on COM(2022)703 - Amendment of Regulation (EU) No 904/2010 as regards the VAT administrative cooperation arrangements needed for the digital age - Main contents
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| dossier | COM(2022)703 - Amendment of Regulation (EU) No 904/2010 as regards the VAT administrative cooperation arrangements needed for the digital ... |
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| document | COM(2022)703  |
| date | December 8, 2022 |
(2) Council Directive (EU) XX/XXX 15 [OP please insert number and year of the Council Directive amending Directive 2006/112/EC as regards VAT rules for the digital age adopted the same day as this Regulation] introduced into Council Directive 2006/112/EC 16 digital reporting requirements (‘DRR’). Those requirements oblige taxable persons identified for VAT purposes to submit to Member States information on each intra-Community supply of goods, on each intra-Community acquisition of goods and on each supply of a service that is taxable in a Member State other than the one in which the supplier is established. Member States need to exchange and process that information on intra-Community transactions to monitor the correct application of VAT and to detect fraud.
(3) The existing cooperation between Member States’ tax authorities is based on exchanging aggregated information between national electronic systems. The introduction of DRR aims to increase tax collection by providing transaction-by-transaction data to tax administrations in a timely manner. To make those data available to other tax administrations in an efficient manner, and to facilitate a common implementation of analysis and crosschecks, as well as a common interpretation of those analyses and crosschecks, a central system where VAT information is shared is necessary.
(4) In order to enable Member States to fight VAT fraud more effectively, a central electronic VAT information exchange system (‘central VIES’) for sharing VAT information should be established. That system should receive, from national electronic systems of Member States information about intra-Community transactions as reported by the respective suppliers and acquirers in different Member States. That system should also receive from Member States the VAT identification information of taxable persons making intra-Community transactions. Furthermore, whenever data are changed, the metadata for tracking the modification time should be uploaded into the central VIES as well.
(5) The VAT identification information of taxable persons making intra-Community transactions should be automatically updated in the central VIES without delay whenever identification information changes, except where Member States agree that such update is not pertinent, essential or useful. Such updates are necessary because the validity of the VAT identification numbers of taxable persons is subject to verification as regards the condition for exempting intra-Community supplies provided for in Article 138 of Directive 2006/112/EC. To provide a reasonable level of assurance to tax administrations with regard to the quality and reliability of such information, information on intra-Community transactions should be automatically updated in the central VIES no later than 1 day after the Member State received the information from the taxable person.
(6) Furthermore, with regard to VAT identification information in the central VIES, Member States should adopt measures to ensure that the data provided by taxable persons for their identification for VAT purposes in accordance with Article 214 of Directive 2006/112/EC, are assessed by the respective Member State as complete and accurate. Moreover, Member States should ensure that the VAT identification number is shown as invalid in the central VIES where a taxable person fails to respect the obligations to communicate data or the economic activity is ceased.
(7) The information on intra-Community transactions reported by the suppliers and acquirers in different Member States should be entered by each Member State into the central VIES promptly after the Member State received it. It is necessary to process the information received quickly, for technical reasons related to the data volume as well as to detect suspicious transactions and possible cases of VAT fraud early.
(8) To assist Member States in their fight against VAT fraud and to detect fraudsters, VAT identification information and VAT information on intra-Community transactions should be retained for 5 years. That period constitutes the minimum period necessary for Member States to carry out controls effectively and investigate suspected VAT fraud or detect such fraud. It is also proportionate considering the massive volume of the intra-Community transaction information and the sensitivity of the information as commercial and personal data.
(9) To detect mismatches in a timely manner and thereby improve the capability to fight VAT fraud, the central VIES should be able to automatically cross-check the information collected from both the supplier and acquirer through the DRR introduced by Directive (EU) XX/XXX [OP please insert number and year of the Council Directive amending Directive 2006/112/EC as regards VAT rules for the digital age adopted the same day as this Regulation 17 ]. The results of such cross-checking should be made available to Member States for the appropriate follow-up.
(10) Furthermore, to allow the central VIES to maintain the capabilities of the existing VAT information exchange system provided for in Article 17(1), point (a), of Regulation (EU) No 904/2010, it should also be able to aggregate information to provide an overview of supplies and acquisitions reported by taxable persons located in Member States. To ensure that the central VIES permits Member States to continue accessing each other's information as currently structured within the existing VAT information exchange system, the central VIES should support data aggregation.
(11) To support the competent authorities of Member States to effect a correct assessment of VAT, monitor the correct application of VAT, combat VAT fraud, and exploit the synergies between different information systems containing VAT relevant information, the central VIES should process information received from Member States together with any information communicated or collected pursuant to Regulation (EU) No 904/2010.
(12) Access to the information in the central VIES should be provided on a need-to-know basis. That information should not be used for other purposes than to monitor the correct application of VAT and combat VAT fraud. All users should be bound by the confidentiality rules laid down in this Regulation.
(13) To fight VAT fraud, Member States’ Eurofisc liaison officials as referred to in Article 36 of Regulation (EU) No 904/2010 should be able to access and analyse VAT information on intra-Community transactions. To monitor the correct application of VAT laws, Member States’ officials who check whether the exemption of VAT for certain imported goods, which is laid down in Article 143(1), point (d), of Directive 2006/112/EC, applies, should also be able to access VAT identification information that is stored in the central VIES. Moreover, for the same reasons, Member States’ competent authorities should select other officials who need to have direct access to the central VIES and grant them such access where needed. Finally, duly accredited persons of the Commission should be able to access the information contained in the central VIES, but only to the extent that such access is necessary for the development and maintenance of that system.
(14) To investigate suspected VAT fraud and to detect such fraud, the information systems supporting the Eurofisc network in the fight against VAT fraud, including the Transaction Network Analysis system and the central electronic system of payment information (“CESOP”), should have direct access to the central VIES.
(15) The data volume and the frequency of data transmissions to the central VIES render the automation of the information flows from the central VIES to national systems necessary. Such automation should also provide for an efficient and secure machine-to-machine communication channel, and should ensure that there is no longer a need for human intervention when accessing shared data. National electronic systems that transmit information to the central VIES should therefore also have access to the information stored in that system, including the processed and aggregated information for VAT control purposes and for the fight against VAT fraud.
(16) In order to ensure uniform conditions for the implementation of Regulation (EU) No 904/2010, implementing powers should be conferred on the Commission in respect of the tasks to be carried out by the Commission for technically managing the central VIES, the technical details concerning the identification and access of officials and electronic systems to the central VIES, the technical details and format of the information transmitted to the central VIES and the roles and responsibilities of Member States and the Commission when acting as controller and processor under Regulations (EU) 2016/679 18 and (EU) 2018/1725 19 of the European Parliament and of the Council. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council 20 .
(17) VAT fraud is a common problem for all Member States. Member States alone do not have the information necessary to ensure that the VAT rules are correctly applied and to tackle VAT fraud. Since the objective of Regulation (EU) No 904/2010, the fight against VAT fraud, cannot be sufficiently achieved by the Member States because of the cross-border nature of the internal market, but can be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve that objective.
(18) Taxable persons facilitating supplies of goods or services through the use of an electronic interface may be subject to requests for records from the Member State where those supplies are taxable as referred to in Article 242a of Directive 2006/112/EC. To reduce the administrative burden and compliance costs for those taxable persons and to avoid duplication of work, the Member State of identification should coordinate such requests as much as possible. For that purpose, it is necessary to lay down a standard form for the electronic transmission of this information to Member States.
(19) A new One-Stop-Shop (‘OSS’) simplification scheme is to be introduced into Directive 2006/112/EC for taxable persons who are transferring certain own goods cross-border. It is therefore necessary to integrate that new scheme in the overall framework of the VAT OSS special schemes set out in Chapter XI, Section 3, of Regulation No 904/2010. It should notably include the provision of information between the Member State from and to which the goods are transferred.
(20) As the new OSS scheme is comprehensive and encompasses cross-border movements of goods that are currently covered by call-off stock arrangements in accordance with Article 17a of Directive 2006/112/EC, those arrangements have been deleted from Directive 2006/112/EC. It is necessary that that amendment of Directive 2006/112/EC is reflected in Article 21 of Regulation (EU) No 904/2010.
(21) The abuse of Import One-Stop-Shop (‘IOSS’) VAT identification numbers has been identified by stakeholders as a potential risk. To better secure the correct use and the verification process of IOSS VAT identification numbers, it is necessary to extend Article 47h of Regulation (EU) No 904/2010 granting customs authorities access to information about the IOSS registered trader, which will improve the risk management and control capabilities of those customs authorities.
(22) To enhance controls in relation to the IOSS scheme, it is necessary to add the total value of the goods imported under the IOSS scheme per IOSS identification number per Member State of consumption to Article 17(1), point (e), of Regulation (EU) No 904/2010.
(23) The technical details, including common electronic messages, for the submission of records by the taxable persons facilitating supplies through the use of an electronic interface as referred to in Article 242a of Directive 2006/112/EC should be adopted in accordance with the comitology procedure provided for in this Regulation.
(24) This Regulation respects the fundamental rights and observes the principles recognised by the Charter of Fundamental Rights of the European Union. In particular, this Regulation seeks to ensure full respect for the right of protection of personal data laid down in Article 8 of the Charter. In that regard, this Regulation strictly limits the amount of personal data that will be made available to the tax authorities. The processing of intra-Community transaction information pursuant to this Regulation should only occur for the purposes of this Regulation.
(25) The European Data Protection Supervisor was consulted in accordance with Article 42(1) of Regulation (EU) 2018/1725 and delivered an opinion on […]
(26) As the implementation of the central VIES system will require new technological developments, it is necessary to defer the application of the provisions related to the central VIES to allow Member States and the Commission to develop these technologies.
(27) Automated access to information on intra-Community transactions which have been reported via recapitulative statements is directly affecting the efficiency of VAT controls. Therefore the current VAT information exchange system provided for in Article 17(1), point (a), of Regulation (EU) No 904/2010 should be maintained for a period of time after the abolition of those recapitulative statements. Beyond that period, the relevant provisions of the current VAT information exchange system should be deleted and the information reported via recapitulative statements should still be accessible on request.
(28) Regulation (EU) No 904/2010 should therefore be amended accordingly.