Who is affected?
All players in the e-commerce supply chain are affected, from sellers and marketplaces/platforms, both within and outside the European Union, to postal operators and courier companies, customs and tax authorities in the various Member States of the European Union, and consumers.
European end consumers
The new regulations on VAT in electronic commerce aim to provide transparency, simplify procedures and guarantee fair taxation for all suppliers. Previously, companies outside the EU could avoid paying VAT and had no VAT obligations in the EU , so their prices were lower. As a result, companies in the EU were harmed. Due to the lack of transparency, consumers were sometimes faced with costs or charges to be paid at customs for imported products. However, from July 1, 2021, the price paid may be the final price, without having to pay VAT or other fees on import. This only occurs when goods are purchased from a seller or electronic interface registered with the IOSS.
If you do not register with the Import Single Window (IOSS), you will have to pay VAT and other possible postal/transport charges when the goods are imported.
The new rules will make it possible to:
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Ensure that VAT is paid where the consumption of goods and services occurs.
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Create a uniform and transparent VAT regime for cross-border deliveries of goods and services.
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Establish fair competition between European and foreign operators in the e-commerce market, as well as between e-commerce and brick-and-mortar stores.