On 11 March 2025, all EU Member States adopted the proposals with respect to VAT in the Digital Age ('ViDA') after several compromises and modifications compared to the original proposals. In December 2022, the first proposals were published. On 5 November 2024, a political agreement was reached on a compromise text of the proposed ViDA proposals. Last week’s adopted text does not contain any major changes compared to the text of the political agreement. According to the adopted proposals, most changes are intended to be implemented gradually between 2027 and 2035. 

These new rules will impact all companies involved in international trade and e-commerce, mainly due to e-invoicing and digital reporting requirements. 

The three main topics of ViDA are:

  1. The Single VAT registration in the EU to mitigate the registration obligations for specific transactions in other EU Member States. This will be implemented by extending the scope of the One Stop Shop (OSS).
  2. The Platform Economy. In this respect, a new deemed supplier provision will be introduced for passenger transport services and short-term accommodation rental. The proposed extension to broaden the scope of the definition of the deemed supplier provision relating to goods has been narrowed.
  3. The Digital Reporting Requirements and the use of mandatory e-invoicing for cross-border transactions.

What to do? 

We recommend businesses to obtain a good understanding of these adopted rules to determine whether internal processes have to be amended and review whether the VAT compliance position will be mitigated or increased. In this respect, potentially IT changes are required to comply with this newly proposed legislation. Our VAT specialists are happy to discuss the potential impact with you. 

Please find a more detailed overview of the proposed changes below. 

The OSS will be extended to a Single VAT registration

After the implementation of the OSS scheme’s as of 1 July 2021 the EU proposed with ViDA to extend the OSS by introducing the Single VAT registration (SVR). 
The SVR provides a modification and clarification to the existing e-commerce package currently implemented. With the SVR the EU is moving towards taxation based on the destination principle. 

The current OSS scheme for intra-EU distance sales and B2C services taxable in the EU Member State of destination will be extended to: 

  • domestic supplies;
  • the supply of goods with installation or assembly;
  • the supply of goods on board of ships, aircrafts of trains; and
  • the supply of gas, electricity, heating and cooling;
  • when VAT is due in another Member State than where the supplier is established, and the recipient meets strict conditions regarding its VAT status. 

Under the initial proposal, it was the intention that the Import One Stop Shop (IOSS) scheme would also be amended, as the use of the IOSS would be made mandatory for electronic interfaces facilitating as a deemed supplier for certain distance sales of imported goods. In the updated proposal applying the IOSS scheme is not mandatory. Currently deemed suppliers can opt to use this scheme. 

In addition to the changes for the (I)OSS the EU is implementing a new special scheme for the transfer of own goods. This scheme will allow companies to report transfers of own goods within the EU to be reported in one return. The use of this special scheme may prevent the requirement for businesses to VAT register in other EU Member States. Currently, if a business holds stock in a foreign country a foreign VAT registration in the respective Member States is required to report the acquisition of goods due to the transfer of own goods and, if applicable, report domestic supplies of goods in that Member State. Due to the proposed changes, the acquisition of goods due to the transfer of own goods can be reported using the special scheme. If VAT is due on domestic B2C supplies of goods, this can be reported in the OSS return under the new rules. 

The changes relating to the Single VAT Registration are proposed to enter into force as of 1 July 2028 for a large part of the changes.

The platform economy

As of 1 July 2021, a deemed supplier provision was introduced for the B2C e-commerce supplies of goods. The proposal for VIDA includes the extension of the deemed supplier provision for certain services. This will result in additional VAT compliance and risks for platforms which are considered as a deemed supplier.

The deemed supplier provision will be implemented specifically for the short-term accommodation rental, and passenger transport sectors of the platform economy. Under strict conditions, the platform is considered to be the deemed supplier and as such responsible to collect and remit the VAT to the (local) tax authorities. In general, the deemed supplier provision is applicable if the seller on the platform does not charge VAT, unless the seller provides the platform with its VAT identification number and states that he will remit the VAT. In case the seller applies the TOMS scheme (tour operator margin scheme), the deemed supplier provision is not applicable.

Platforms will also get an obligation to keep records for B2B and B2C services, even if the deemed supplier provision is not applicable. This record keeping obligation is for 10 years.

The current deemed supplier provision of goods is extended to the scenario whereby the seller is established outside of the EU, but the purchaser of the goods is a business (VAT taxable person), provided that the intra-Community acquisitions of this VAT taxable person are not subject to VAT. 

These proposed changes will also have major impact on companies that have platforms supplying services, as they will need to verify the VAT status of the sellers on their platform and have potential additional VAT obligations. 

The implementation deadline for the deemed supplier regime for platforms is set on 1 July 2028. However, exceptions have been negotiated. Under certain conditions, Member States can choose to postpone this implementation to 1 January 2030. Due to the potential impact platforms and companies that make use of platforms should take action in time to ensure being compliant in time.

Digital Reporting Requirements and E-invoicing

The EU concluded that the current system for the reporting of intra-Community transactions is not sufficient for Member States to prevent VAT fraud. Therefore, the EU has proposed an extensive change to the reporting system and the invoicing. 

  • Currently an invoice needs to be issued no later than the 15th day of the month following the month of the supply of the goods or service takes place. For intra-Community supplies for example, a deviating period will be introduced. For these supplies according to the proposed changes, an (electronic) invoice needs to be issued ten days after the supply takes place.
  • The proposal also includes an obligation for the purchaser of the goods or services. The purchaser will be required to report the transaction within five days after receiving the e-invoice from the supplier. The updated proposal however offers Member States the possibility to waive customer reporting under certain conditions.
  • In addition, the current EU VAT Directive allows a summary invoice to be issued for a period at least once a month. According to the proposal, this simplification will only be available when certain conditions are met. The VAT on the invoice has to be due in the same calendar month and the summary invoice must be issued ultimately the 10th day of the following month. Member States may exclude the possibility of issuing periodic invoices in certain fraud-prone sectors.

Also, the content of the invoice will be updated to ensure that all information required by the Member States is to be included. The following requirements will be added to the invoice requirements: 

  • a reference if cash accounting is used;
  • the information whether the simplified ABC triangulation has been used;
  • the bank account number(s) of the supplier’s accounts into which the recipients of the invoice can pay that invoice;
  • and in case an invoice amends the initial invoice that is issued, the identification of that initial invoice. 

To process all this information a new digital reporting system for intra-Community transactions will be created. The new digital reporting system for the intra-Community transactions will cover the same transactions that are currently covered by the recapitulative statement (EC Sales Listing) except for the call-off stock, which will cease to exist. The new system requires a transaction-by-transaction filing and requires more extensive information than the current EC Sales Listing. In addition, the filing deadline for the electronic transmission of the data is immediately at the moment of issuance of the invoice, or the date when the invoice should have been issued. 

The reporting for cross-border transactions will be obligatory. For the domestic supplies, EU Member States are free to implement digital reporting obligations at an earlier stage. 
The changes relating to e-invoicing and digital reporting are proposed to enter into force as of 1 July 2030 for a large part of the changes.

Dutch developments e-invoicing

Please note that several EU Member States have already implemented e-invoicing or will do so in the near future. A recent parliamentary letter indicated that the Dutch tax authorities for example are currently exploring, through a number of experiments, how a digital transformation of taxation in the Netherlands might look and what issues might arise. One example is e-invoicing, where relevant tax data on digital invoices can be exchanged quickly and in a privacy-friendly manner between companies and the Dutch tax authorities. Another example is the 'tax-splitter,' which allows VAT to be levied and collected directly at the transaction. This makes it possible to send the VAT directly to the Dutch tax authorities' account during a transaction, while the price of the product or service goes to the seller's account. If the experiments are completed to the satisfaction of the Dutch tax authorities and the government's IT systems are ready, it is not excluded  that (a certain type of) e-invoicing will be implemented earlier than July 1, 2030.