The special VAT scheme for travel agents (the “special scheme” or the “travel agent scheme”) was put in place by the Sixth VAT Directive in 1977 as a simplification measure derogating from the normal VAT rules on the place of supply, taxable amount and deduction of input tax. This scheme, currently set out in Articles 306 to 310 of the VAT Directive, has remained unchanged since the adoption of the common VAT system in the EU. Since then, however, divergence in application of the travel agent scheme has arisen between Member States, leading, over the years, to numerous judgments of the Court of Justice of the European Union (CJEU). As a result, in 2002 the Commission adopted a proposal , amended in 2003 (“the 2002/2003 proposal”), to reform the travel agent scheme. No agreement could however be reached in the Council and the 2002/2003 proposal was finally withdrawn in 2014, because it had become obsolete after a series of other rulings of the CJEU. In compliance with its commitment of periodically and regularly review of the provisions of the VAT Directive, in 2017 the Commission contracted a study (“the study”) in order to evaluate the current state of the play of the special scheme, together with possible options for its review.
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