European Union: ViDA is priority for the Belgian Presidency, expectations of reaching an agreement potentially in May or June

The update on the VAT in the Digital Age (ViDA) legislative package provided during the VAT Expert Group (VEG) meeting in March 2024 shed light on the current state of negotiations in the Council. Here's a detailed breakdown of the key points discussed:

Resumption of Negotiations

Negotiations on the ViDA package resumed under the Belgian Presidency in January 2024. Notably, three meetings have been conducted so far: on 18 January and 8 March 2024 focusing on Digital Reporting Requirements (DRR), and on 9 February 2024, a joint VAT and Customs Council meeting discussing the Single VAT Registration (SVR) part of the package.

Progress and Challenges

While significant progress has been achieved, it was highlighted that the ViDA package still requires additional technical work. The Spanish Presidency's progress report in December 2023 indicated an agreement on the SVR component of the package, excluding IOSS elements related to ongoing Customs Union Reform. However, challenges remain, particularly concerning the DRR and Platform Economy sections of the package.

Belgian Presidency Priorities

ViDA stands as a priority for the Belgian Presidency, with expectations of reaching an agreement during their tenure, potentially at the May or June ECOFIN meetings. The upcoming Council meeting on 25 March 2024 will specifically address matters related to the Platform Economy and SVR components.

Discussion and Concerns

VEG members actively engaged in discussions following the update. Specific concerns were raised regarding technical issues within the package, such as the convergence of domestic regimes, reporting deadlines and events, customer reporting requirements, data usage, invoice clearance, e-invoicing, reverse charge mechanisms, and VAT exemption codes, alongside ensuring interoperability with the EU-harmonized DRR system.

Commission Services Response

The Commission services acknowledged and noted all concerns and remarks raised by the VEG. However, they clarified their inability to provide detailed information on specific technical issues or amendments made to the original proposal, as these aspects are still under discussion in the Council. Additionally, details regarding the package's implementation timeline were not yet available.

Package Adoption and Implementation

The Commission services confirmed that splitting the ViDA package is not being considered. The formal adoption of the package will only occur after an agreement is reached on all three parts. Implementation will involve three distinct work streams, each addressing a specific part of the package.

SOURCE:

• VEG 116 - Minutes 35th VEG meeting 18-03-2024.pdf