E-commerce VAT package
The Council of Ministers has adopted a draft law implementing the EU regulations included in the e- commerce VAT package. The EU package consists primarily of EU Council Directive no. 2017/2455 of December 5, 2017 and EU Council Directive no. 2019/1995 of November 21, 2019 and their accompanying implementing acts. The main objective of the draft amendment is to tighten VAT in e-commerce and import of so-called small shipments to the EU. According to the Minister of Finance, the solutions included in the package are intended to facilitate the settlement of VAT on sales of goods and services to consumers in other EU Member States and to increase the competitiveness of EU, including Polish, businesses facing unfair competition from outside the EU.
Main amendments provided for in the draft
The draft provides for the implementation of a definition for a distance intra-community sale of goods and distance sale of imported goods in lieu of current regulations on so-called distance selling.
The special MOSS procedure is to be extended and modified, allowing VAT on telecommunications, broadcasting and electronic services to be declared and accounted for in the supplier's Member State of establishment, without the need for the supplier to register and perform these obligations in the recipient’s country.
The new special One Stop Shop (OSS) procedure will additionally cover:
- certain other services provided for consumers,
- intra-community distance sales of goods,
- certain deliveries of goods in a Member State via electronic interfaces which facilitate those supplies,
- distance sales of imported goods from third countries in parcels with an intrinsic value not exceeding EUR 150 to EU consumers (the so-called Import One Stop Shop - IOSS).
The obligation to collect and pay VAT, under certain circumstances, will be imposed on the taxpayers who intermediate in making sales to EU consumers, which in practise imposes an obligation on undertakings operating electronic sales platforms.
According to the draft, the VAT exemption on imported goods in shipments with a value not exceeding EUR 22 is to be repealed. Although Poland already does not apply this exemption in relation to imported goods by mail-order, the implementation of the Directive may have a positive impact on the equality of opportunities for all EU member countries.
The new regulations are to take effect on July 1, 2021. However, it is worthwhile to analyse one’s situation in advance and adjust one’s company's processes to the upcoming regulations.
Jakub Janicki, Tax Consultant, ATA Tax Sp. z o.o.
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