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Martin Morawski

Martin Morawski is a Legal Director in Baker McKenzie's Amsterdam office.

With the rise of digital platforms and the possibilities internet provides for businesses, more and more sellers are able to offer goods and services via these platforms and the internet. In this context, it has become difficult for tax authorities to trace the flow of goods and services as well as to identify sellers to ensure that these goods and services are taxed in accordance with EU tax principles.

Baker McKenzie’s VAT/Indirect Tax Practice presented “Financial Services VAT,” on 7 October 2020. This was the fifth presentation in the International VAT Conference Webinar Series, a global webinar series designed for VAT specialists from all industry sectors that aims to discuss the latest developing trends and hot topics in the VAT/goods and services tax (GST) and customs arena.

On 15 July 2020, the European Commission (“EC”) adopted a new Tax Package aimed to “contribute to the economic recovery and long-term growth of Europe”. The Tax Package consists of three elements: (i) a revision of the Directive on Administrative Cooperation “DAC7), (ii) a Communication on Tax Good Governance, and (iii) a Tax Action Plan for a fair and simple taxation supporting the recovery. The Tax Action Plan is a set of legislative and non-legislative initiatives on taxation that the EC plans to deliver between 2020 and 2023. As such, the Tax Action Plan itself is not a legislative proposal.

The EU Member States agreed to postpone the entry into force date of the ‘VAT e-commerce package’. 

The VAT e-commerce package introduces new VAT rules that -in essence- aim to make online sales of goods to EU consumers become effectively subject to VAT in the EU. Under the current EU VAT rules, online sales of goods that are imported into the EU, in practice often remain free of VAT.