- Proposal Overview: Hungary, holding the EU Council presidency, is set to propose a 10-year opt-out from the VAT in the Digital Age (VIDA) package. This package would otherwise make digital platforms responsible for VAT collection. The proposal aims to address concerns from member states about the deemed supplier regime affecting platforms like Airbnb and Uber.
- Options for Member States: In a meeting on October 15, Hungary presented two options to member states. The first option allows countries to request a derogation from the deemed supplier regime for up to 10 years, with no specific conditions required. The second option, inspired by a previous Belgian proposal, offers an opt-out for small and medium-sized enterprises (SMEs), simplifying administrative processes by removing the need to inform the VAT committee of specific conditions.
- Estonia’s Position: Estonia, initially resistant, has shown openness to a general opt-out regime. Previously advocating for a reverse mechanism allowing member states to opt-in, Estonia now prefers no end date for derogation. However, the EU Council legal service insists that an end date is legally necessary.
- Negotiation Timeline: The presidency aims for member states to agree on one of the options before an October 24 meeting of the high-level working party. The goal is to reach a consensus by November, ensuring smooth implementation of the VIDA package.
- Context and Contributions: The proposal is part of ongoing discussions within the EU on digital taxation and VAT collection. Sophie Petitjean contributed to the reporting on this development, highlighting its significance in EU tax legislation and lawmaking.
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