More Time to Implement ViDA Regulations?

ViDA is a package of new measures, mainly updating the VAT Directive to adapt it to new digital business models and enable the full use of data generated by digitization. The regulations proposed under ViDA are to enter into force in stages in the years 2024-2028. The proposal was published by the European Commission in December 2022, and is still subject to numerous consultations, as the changes to be introduced could have a significant impact on any business in the EU.

At the end of June 2023, the European Parliament published the report with many comments on the European Commission’s proposed actions and changes announced under the ViDA regulations.

The EU Parliament has expressed strong concerns about the short timeframe for the implementation of so many changes by the Member States, especially as regards small and medium-sized enterprises, as they will have to deal with the complexity of the rules and bear the high costs of implementing the proposed solutions.

ViDA Regulations Postponed

It has been also underlined, that there is a need to respect the principle of proportionality between the objective of combating fraud and the difficulties that might arise in applying the proposed rules to the real life of businesses. Fighting tax fraud must not be to the detriment of the majority of businesses that work in transparency and good faith. Bearing in mind these doubts, it was proposed to postpone the date of entry into force of the regulations defined under ViDA by at least a year, and to implement them in stages in the years 2025-2029.

The EU Parliament has therefore recommended:

• Postponing the implementation of ViDA by at least a year
• Offering business incentives (especially targeted at SMEs) as a way to minimize the costs of ViDA implementation
• Changing the deadline for issuing invoices for cross-border transactions from two days to at least 10 business days
• Introducing the optional use of structured EN 16931 e-invoices
• Treating invoices in pdf format with an electronic signature as electronic invoices for transactions not subject to digital reporting requirements
• Restricting access to VIES exchanges in order to protect personal data and allowing the transfer of partial data only to the appropriate administrative authorities and only in the context of combating VAT fraud. In addition, the Commission should specify how data can be examined by tax authorities
• Keeping the Intrastat report (international trade statistics)
• Preservation of summary invoices (saves time and costs and reduces the administrative burden of invoicing)