Source: European Parliament
The new EU VAT reform, in force since 1 July 2021, is creating enormous challenges for small and medium-sized online retailers. Setting the VAT delivery threshold at EUR 10 000 for intra-Community B2C deliveries to non-entrepreneurs, means that VAT must henceforth be stated for the respective destination country if the delivery threshold is exceeded. This creates a problem for businesses when making intra-Community sales to non-entrepreneurs (B2C), as the VAT rate must be determined for each destination country at great expense. The VAT rate is in turn based on the specific customs tariff number. Therefore, depending on the product, different VAT rates may apply within a destination country.
This imposes a disproportionate bureaucratic burden on small online retailers, making intra-Community sales to non-entrepreneurs (B2C) largely unprofitable.
1. Is the Commission aware of this situation, and does it share the view that the additional bureaucratic burden places a disproportionate strain on SMEs when making intra-Community sales to non-business customers (B2C)?
2. How does the Commission intend to remedy these problems, what consideration is being given to extending the reform to intra-Community sales to traders (B2B), and does the Commission agree that this would significantly exacerbate the aforementioned issues?
3. How will the Commission prevent a similarly cumbersome bureaucratic burden in the event of a possible extension to intra-Community sales to entrepreneurs (B2B)?