With the first edition of the WTS Global VAT Newsletter in 2020 we want to share with you insights on the latest developments in terms of VAT and GST across the globe.
Since today the economic and social impacts of the corona virus disease (COVID-19) all over the world are the most important news, WTS Global created an overview of the measures taken by various countries to respond to the tax aspects of this crisis: https://wts.com/global/insights/covid19
Apart from this, in Europe the EU-Member States generally focused on the implementation of the so-called Quick Fixes but also considered further areas to secure the collection of VAT:
France sharpened its already existing regulations for online marketplaces and introduced a joint liability for platform operators concerning VAT areas of suppliers using the platform as well as a “name and shame” sanction mechanism on the Internet.
The already existing online invoice reporting process in Hungary will receive an extension of its scope. By 1 July 2020, the current threshold of invoiced VAT (HUF 100,000) will be abolished.
Romania abandons the idea of tackling VAT fraud by means of split payments, whereas Poland has just introduced a split payment process for certain goods and services (see GVN Q3 2019). In addition, Poland launched a new “White List” approach to prevent customer payments from being routed to unregistered bank accounts. Furthermore, there is to be considered the forthcoming important modification of the SAF-T data reporting to the Polish fiscal authorities.
And also outside of Europe, VAT (or GST) is of course in the focus of legislation and tax authorities:
Angola has now completed its first months under Value Added Tax provisions, and is already recasting its regulations to cover specific economic needs in the province Cabinda and with regard to the oil exploration sector.
Azerbaijan streamlined the administrative burdens for business by abolishing the previously required electronic tax invoicing just for VAT purposes, so that the currently available electronic invoicing will be used for both billing (tax invoicing) and VAT purposes. Moreover, the accrual method has been generally replaced with the cash method for the purposes of the calculation and payment of VAT.
Nigeria has seen a general reshaping of the VAT landscape, implementing, amongst others, changes for VAT compliance, thresholds for VAT returns and effects of VAT non-remittance.
With the Kingdom of Saudi Arabia, Oman, Qatar and Kuwait, we report on four Member States of the Gulf Cooperation Council dealing with indirect taxes. The Kingdom of Saudi Arabia already implemented VAT in 2018, whereas Oman, Qatar and Kuwait have not yet completed this process, but rather have already achieved more progress in the adoption of
excise tax based on the GCC’s Common Excise Tax Agreement of 2016.
Singapore aims to tackle the distortion of competition by introducing a reverse charge mechanism for imported B2B services as well as an overseas vendor registration regime for B2C supplies of imported digital services. Special regulations for digital payment tokens have been implemented in order to cope with digitalisation.
Electronic services continuing to increase their relevance and market-share has led to Turkey implementing a Digital Service Tax as of 1 March 2020, e.g. on the sale of audio, visual or digital content as well as advertising services that are performed in the digital environment.
Ukraine is considering extending its VAT rules to B2C cross-border sales of digital services, making them subject to 20% Ukrainian VAT by 1 January 2021.
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