On March 11, 2025, the Council of the European Union officially approved this new directive. The EU member states must now implement these rules. The approval of this directive will thoroughly overhaul the VAT system.
The experts from our Baker Tilly International network partners in the Netherlands discuss the main rules and their implementation in this article.
VAT fraud and cross-border tax evasion structures (including ‘carousel fraud’) result in billions in losses for the treasuries of the EU and its member states every year. Also, the rules are complicated and lead to a relatively high administrative burden for businesses.
Now that the directive has been approved, the EU member states must implement the rules in their national legislation. The most important changes should in principle enter into force on 1 July 2028.
The ViDA Directive primarily concerns digital supplies of goods and services. Examples are e-invoicing, digital reporting and VAT for the platform economy. Several administrative matters are also addressed, such as the Single VAT Registration and adjustments to the One Stop Shop (OSS).
Aside from these main points, the adjusted proposal contains a number of other changes. Read more about the ViDA Directive and the expected timetable for the implementation of the various changes in our previous article.
Although it may be a while before the changes actually take effect, (internationally operating) businesses are advised to start preparing as soon as possible. Business processes such as invoicing and ERP configuration will need to be adjusted to comply with the new e-invoicing rules.
Implementing the new digital reporting requirements within the business may also take some time. Implementing the changes properly will often be an expensive and time-consuming matter.
If you have questions about the current state of affairs or would like to know more about ViDA and what steps your business needs to take in preparation for ViDA, please contact the specialists from Baker Tilly.
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Please keep in mind the fact that legislation tends to change frequently. This article is therefore necessarily based on our understanding and correct interpretation of the law and practice at the time of issuing this article. This article will not be updated due to changes in legislation that occur after this article is issued.