Abstract
From January 1, 2015 electronically delivered services in the EU are taxed in the country where the customer resides, regardless of whether the customer is a VAT payer or a consumer. The main change involves a shift from the origin principle to destination principle as the criterion for determining the place where electronic services for B2C transactions in the EU are provided. The Mini One-Stop Shop is a new mechanism through which businesses can account for VAT at the rates applicable in member states other than where they are established. The purpose of this article is to analyze legal and economic aspects of these changes.
Highlights
Tax principles were historically designed to govern economic activity that dealt with the production and sale of tangible manufactured goods
Many VAT-systems impose a VAT burden on consumption by private individuals, and on various entities that are involved in non-business activities [OECD, 2014, p. 6]
The result of applying the origin principle is that the tax burden on goods or services supplied to private consumption equals the sum of the value added in each country that contributed to the production, distribution, and supply of the goods or services, multiplied by the VAT rate applicable in each such state
Summary
Tax principles were historically designed to govern economic activity that dealt with the production and sale of tangible manufactured goods. The result of applying the origin principle is that the tax burden on goods or services supplied to private consumption equals the sum of the value added in each country that contributed to the production, distribution, and supply of the goods or services, multiplied by the VAT rate applicable in each such state.
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: Annales Universitatis Mariae Curie-Skłodowska, sectio H, Oeconomia
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
