The EU Council will work on the priorities of the new Estonian presidency concerning taxation, particularly modernizing VAT to address the digital economy, ministers announced following an economic and financial affairs (ECOFIN) meeting held July 11.
“The development of cross-border e-commerce makes it necessary to modernise VAT for cross-border e-commerce in order to facilitate cross-border e-commerce for SMEs, combat VAT fraud and ensure a level playing field between EU businesses and third-country businesses,” the presidency said in document outlining its goals for its term, prepared in advance of the meeting.
In the document, the presidency said it intends to launch negotiations on a definitive cross-border VAT system based on the principle of taxation at the place of consumption to replace the current temporary mechanism.
Also on the list is reaching agreement on an EU Commission tax transparency proposal targeting tax advisors and other middlemen who help design tax planning schemes.
Estonian Finance Minister Toomas Tõniste told reporters after the ECOFIN meeting that work on the intermediaries proposal will begin in a few days. He said the proposal is high on the presidency’s agenda because it furthers goals of tax fairness and curtailing tax avoidance. He also noted that existing mechanisms for automatic exchange of information could be used to implement the proposal.
