BDO Indirect Tax News - Issue 3/2020
05 October 2020
Original content provided by BDO
These are still challenging times and no one knows exactly what lies ahead of us. We still see governments taking measures to deal with the consequences of the COVID-19 crisis, such as VAT rate cuts in Ireland, Germany, and Belgium, while some countries are slowly cutting back on measures taken previously.
The COVID-19 crisis has also resulted in many changes in behavior and these have led to shifts in focus for tax authorities. For example, an increase in online sales has made the Guatemalan tax authorities more focused on these types of transactions. In the meantime, the EU has agreed to postpone the coming-into-force of the new VAT e-commerce rules until 1 July 2021 to give Member States that had to deal with the consequences of the COVID-19 crisis more time to implement this legislation and accompanying IT-systems. In the US the tax treatment of e-commerce remains an important topic too, as is shown by the article from our US colleagues that you will find it this edition.
In this issue we also report on some other significant developments, including the release of an important French Supreme Court decision that confirms that lessors can opt for VAT on the rental of professional premises per lot, rather than globally. And, last but not least, there's the news that the Czech Republic has decided not to implement a general reverse charge rule because it felt it wasn’t worth it, as it would be in force only a very limited time (1 July 2020 to 30 June 2022). The Czech Republic previously pressed on with the option of implementing a general reverse charge rule and other EU Member States where interested in the results of the Czech Republic’s experience. This means that a general reverse charge rule will not be implemented in any EU Member States, as some that had considered it have decided against it and other Member States simply do not meet the criteria. Whether implementation of a general reverse charge rule will work in combatting VAT fraud will, therefore, remain to be seen.
BDO Indirect Tax News focuses on issues of practical importance in the field of VAT and similar indirect taxes, such as GST. Experts from all over the world provide first-hand information on recent developments in legislation, jurisdiction and tax authorities’ opinions and directives.