The EU VAT Forum (a sub-group of the European Commission) recently released a report on the VAT aspects of E-commerce. The Commission found that one of the biggest challenges facing tax administrations and businesses is how parties access and exchange information in the e-commerce supply chain. Tax Administrations are challenged to devise a way to ensure data can be accessed, while businesses face the challenges of meeting a complex array of country-specific reporting requirements.
The report contends that governments must aim to support legitimate trade by making the process as a simple as possible, balancing their legitimate interest in targeting non-compliant businesses while maintaining a reasonable compliance burden for all taxpayers.
The Commission recognizes that solutions may be found in emerging technologies including Artificial Intelligence, Blockchain, Chatbots, and Data Analytics. These technologies all have the potential to provide simple, digital solutions that can foster compliance and legal certainty. In fact, to the extent that the report represents any conclusions, it's that technology and automation must be considered.
About the Author
Brendan Magauran is a Junior Regulatory Counsel at Sovos Compliance specializing in international taxation, with a focus on Value Added Tax Systems in the European Union. Brendan received his B.A. and J.D. from Washington University in St. Louis and is licensed to practice in New Hampshire and Massachusetts.More Content by Brendan Magauran