As part of the EU's end-of-term push to cut red-tape for businesses in the EU, the Commission said VAT returns were one of the problems reported most by companies, as they “battle with a complex medley of information requirements, procedures and deadlines.”
Starting in 2017, provided the proposal is adopted by member states, the VAT return submission will be identical in all EU countries.
“Some Member States ask for monthly declarations, others ask for quarterly ones. The standard VAT return we have proposed today will eliminate this problem, by replacing the 28 diverse national systems with a simple and uniform EU approach”, Šemeta said on Wednesday (23 October).
The new return form will contain five mandatory information boxes: chargeable VAT, deductible VAT, net VAT amount (payable or receivable), total value of input transactions and total value of output transactions.
Member states will be allowed to add 21 optional boxes depending on the need of each national administration. The Commission also wants to harmonise the periodicity of the returns, the submission deadlines, the procedures to submit corrections and the format of electronic submission of returns.
Having one identical VAT return form will not only ease the burden on the national fiscal authorities, it also “reduces the loopholes that can be used for tax evasion purposes,” the Commission said.
The forms will have to be returned in the language of the country of return.
The EU executive calculated that the overall financial impact of the proposal would amount to €15 billion a year: the removal of obstacles to cross-border trade results would bring a benefit of €3 to 6 billion, while reducing administrative burdens would add another €9 billion in benefits.
The standardisation of VAT returns in the EU is a part of the Commission’s “Refit” programme, a new set of measures aimed at making EU law simpler in order to create a more business-friendly environment across the Union.