VAT rules on e-commerce: EU Commission outlook two years on

The EU Commission has published figures on the 2022 revenue collected through the simplified e-Commerce VAT reporting schemes which were introduced in as part of the ‘VAT on e-commerce’ changes in July 2021, providing its outlook on the changes two years since its inception.

As part of the 2021 VAT on e-commerce changes two simplified VAT reporting schemes were introduced, allowing businesses to report & pay VAT collected on e-Commerce sales across the EU through a single declaration in one EU member state: for cross-border consumer sales within the EU via the ‘One Stop Shop’ (OSS), and for import sales of low-value goods delivered from outside the EU via the ‘Import One Stop Shop’ (I-OSS).

The Commission has reported that the schemes collected over €20 billion in VAT in 2022, which represents an increase of 26% in comparison to 2021, and which is inclusive of new VAT revenues generated by the removal of the low-value VAT exemption on imports.

The Commission is clearly very positive about the overall implementation of the e-Commerce rule changes & reporting schemes two years on; pointing to its success in terms of both the revenue generated, as well as the take-up of the schemes by business with over 130,000 companies registering for OSS & I-OSS schemes. This positivity is further demonstrated by the Commission’s planned expansion of the simplified e-Commerce rules & reporting schemes as part of the ‘VAT in Digital Age’ proposals, as well as the expansion of the scope of the I-OSS (the removal of the low-value threshold) as part of its proposed customs reforms.

If you have any questions on the existing simplified e-commerce reporting schemes, or the impacts of the proposed changes to same, please contact us here.