The European Commission has proposed delaying information exchange deadlines and the implementation of the VAT e-commerce package because of challenges stemming from the coronavirus pandemic.
A May 8 proposal for a council decision amending Directives 2017/2455 and Directive 2019/1995 would postpone the application date of the measures contained in the VAT e-commerce package until July 1, 2021. The directives call for member states to apply these measures from January 1, 2021.
In April Germany requested a 12-month delay in the implementation of these rules, which are intended to modernize the VAT regime for cross-border e-commerce.
The commission also issued a proposal for a council directive to amend Directive 2011/16/EU on administrative cooperation, to address the need for deferral of deadlines for the filing and exchange of information.
“Based on the proposed changes, member states will have three additional months to exchange information on financial accounts of which the beneficiaries are tax residents in another member state. Similarly, member states will have three additional months to exchange information on certain cross-border tax planning arrangements,” the commission said in a May 8 release.
The commission’s proposal includes an opportunity to extend the deferral period once, for up to three months, if the pandemic persists.
The proposal would delay several deadlines for filing and exchanging information under DAC6 (Council Directive (EU) 2018/822), an administrative cooperation directive that introduced new mandatory tax reporting rules for some cross-border arrangements. The application date of DAC6 will still be July 1, meaning reportable cross-border arrangements made during the deferral period will have to be reported after that period. The commission had been considering delaying these reporting deadlines after receiving feedback from financial intermediaries.
The commission said it remains committed to fighting tax avoidance and evasion and called on the European Parliament and the EU Council to adopt the proposals “as soon as possible in order to provide legal certainty to all stakeholders.”
An EU announcement about international corporate taxation set to happen June 24 has been postponed. A commission source said the decision to postpone came from the OECD moving “important decisions” on the matter to the second half of 2020 and the implementation period to 2021.
Pascal Saint-Amans, director of the OECD Centre for Tax Policy and Administration, confirmed on May 4 that the OECD will postpone talks scheduled for July 1-2 aimed at reaching an agreement on a two-pillar solution for taxing the digital economy.