TaxSource Total

Here you can access summary of the key current tax developments in Ireland, the UK and internationally as reported by Chartered Accountants Ireland

The report of key tax developments are displayed per year, per month, by Ireland, the UK or International and by report title

EU: VAT Update

I. Proposal to amend several elements of the VAT Directive

It has been brought to the attention of the European Commission that several elements of the recasted Sixth Directive need amendment. Consultation has already taken place and no external expertise is deemed necessary.

The following, taken from the official Commission documentation, is a summary of the proposed amendments to Directive 2006/112/EC of 28 November 2006 (recast of the Sixth Directive):

  • the VAT scheme applicable to the supply of natural gas, electricity, heat and/or refrigeration;
  • the tax treatment of joint undertakings set up pursuant to Article 171 of the EC Treaty;
  • the taking into account of certain consequences of EU enlargement (Bulgaria and Romania); and
  • the conditions under which the right to deduct input VAT may be exercised.

More information on the proposed amendments is available from the Commission Proposal for a Council Directive.

II. No agreement reached on VAT

At the recent ECOFIN meeting, it was decided to carry forward the VAT Package and reduced VAT rates topics to the next meeting which will be held in December.

The VAT package contains:

  • a draft directive on the place of supply of services;
  • a draft directive on refund procedures for non-established businesses;
  • a draft regulation on administrative cooperation and the exchange of information between Member States.

The measures are intended to enter into force on 1 January 2010.

The reduced VAT rate proposal is aimed – without influencing the broader debate on reduced VAT rates – at prolonging until 31 December 2010 certain derogations that were introduced into the VAT Directive by the five countries’ acts of accession when they joined the EU in 2004, and that would otherwise expire at the end of this year.

III. Commission adopts VAT and Customs programme to 2013

The Commission has adopted Fiscalis 2013, which should

  • enhance the fight against tax fraud, in particular against “VAT carousel fraud”;
  • reduce the administrative burden on administrations and taxable persons; and
  • ensure a performing exchange of information between national tax administrations as well as with traders.