ACCA welcomes the publication of the VAT modernisation package

Date

04 Oct 2017

Sections

Euro & Finance
InfoSociety

Press release

ACCA (the Association of Chartered Certified Accountants) shares the European Commission’s views that in our modern, digital, interconnected  economies,  it is imperative to modernise the VAT system to make it fit to today’s fight against fraud challenges. We agree with the gradual steps approach chosen by the EU executive.

Commenting on the legislative package on the definitive VAT system for intra-Union business-to-business (B2B) trade, Chas Roy-Chowdhury, head of taxation at ACCA says: “We welcome the European Commission’s bold approach and would urge Member States to accept the initiative. The two-staged implementation balances the access to the benefits with a recognition of the difficulties of modelling for certain supplies, in particular services – such as cross border travel. It will be essential the elements of the OneStopShop are properly developed and tested before deployment. While the measures will aid business if rolled out effectively, under-prepared tools could undo the progress achieved elsewhere”.

Chas Roy-Chowdhury however notes regarding the proposal on the reform of the VAT rates: This is likely to be the most contentious area.  Even when the UK leaves the EU, several other Member States which will not accept – or will find very difficult politically to accept -  harmonisation in this area”.

But the European Commission document itself recognises under the destination based system, there is  less worry about convoluted rates from a consumer perspective. If we can  get  the One Stop Shop right, my understanding from the Commission’s position would mean that then there would be less concern about harmonisation of rates anyway”, Chas Roy Chowdhury adds.

ACCA welcomes the proposal to reinforce the existing instruments for VAT Administrative Cooperation. The global accountancy body sees this measure as a potentially “easy win”, and something member states should be pursuing in any case.

Chas Roy-Chowdhury stresses: “The Commission’s forward looking stance attempts to future-proof the administration of VAT, with an eye to existing and developing models of criminal behaviour that seek to exploit the administrative mechanisms of legitimate trade and taxation. Hovewer, with regard to the interconnection between the VAT system and money laundering and terrorist financing activities, it is also essential the Commission works tirelessly to break down its own internal barriers, so that the proposals work seamlessly with other initiatives in order to improve the business environment and protect citizens property and safety.”

Last but certainly not least, ACCA looks forward to the comprehensive  package to simplify the VAT rules for SMEs in November.

The rollout of the mini One Stop Shop has given the Commission valuable information about how sensitive SME success can be to the effects of the VAT system and its administrative burden. It will be essential for the development of the system that the Commission listens closely to the evidence from those directly affected when developing the changes to the system. ACCA is looking forward to play its part and to bring its expertise, both through the VAT Expert Group, of which ACCA is a member, and  in close collaboration with UEAPME (European Association of Craft, Small and Medium-sized Enterprise), which has a seat at the EU VAT forum”, Chas Roy-Chowdhury concludes.

 

-ends-

 

Notes to editors

About ACCA

Contact: Cecile Bonino, Head of EU Affairs,  tel: +32 (0) 2 286 11 37 or cecile.bonino@accaglobal.com

ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. It offers business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.

ACCA supports its 188,000 members and 480,000 students in 181 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. ACCA works through a network of 95 offices and centres and more than 7,110 Approved Employers worldwide, who provide high standards of employee learning and development. Through its public interest remit, ACCA promotes appropriate regulation of accounting and conducts relevant research to ensure accountancy continues to grow in reputation and influence.

Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. It believes that accountants bring value to economies in all stages of development and seek to develop capacity in the profession and encourage the adoption of global standards. ACCA’s core values are aligned to the needs of employers in all sectors and it ensures that through its range of qualifications, it prepares accountants for business. ACCA seeks to open up the profession to people of all backgrounds and remove artificial barriers, innovating its qualifications and delivery to meet the diverse needs of trainee professionals and their employers. More information is here: www.accaglobal.com

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