Measures concerning VAT & excise duties

The plans for the coming year were officially announced on Prince’s Day. Mazars created a list of the most important (fiscal) proposals from the 2020 tax package for you. What’s changing for you?

Low VAT rate for electronic expenses

From 1 January 2020, the reduced VAT rate of 9% will apply to the supply and lending of e-books, e-newspapers and e-magazines. The reduced rate may also be applied to the provision of access to news websites such as those of newspapers, weekly newspapers and magazines. However, the reduced rate may not be applied to electronic publications and news websites consisting exclusively or mainly of advertising material, videos or music.

Proof of intra-community transport

In order to prove the 0% VAT rate on intra-community supplies, there must be proof that a good has left the member state. The number of supporting documents required will be reduced to two non-contradictory documents by 1 January 2020. In the case of two non-contradictory proofs, the goods shall be deemed to have been dispatched or transported from the supplying member state. Supporting documents must come from two independent parties. Think of a signed CMR document and a transport document signed by an independent third party.

Where the customer arranges for the transport of the intra-community supply, the vendor must have a written statement from the customer, who must comply with specific requirements. This declaration by the customer must reach the supplier not later than the 10th day of the month following that in which the intra-community supply took place.

Correct VAT identification number

As from 1 January 2020, in addition to proof of cross-border transport, the supplier, in order to apply the zero rate to intra-community supplies, must also:

  • submit a correct periodic Statement of Intra-Community Performance (ICP Declaration)
  • have a valid VAT number for the customer

If an entrepreneur has not met these conditions, then the claim to the zero rate on the delivery in question expires. Recovery is possible if, in the opinion of the inspector, the conditions are met later, for example by providing the customer with the correct VAT number within a certain period of time.

Solution for stock on demand

The transfer by a trader of his own goods from the company to another EU member state will, under certain conditions, not be treated as a supply of goods for consideration as from 1 January 2020. The intra-community supply (ICS) and the intra-community acquisition (ICA) will take place at a later date. It is not the supplier but the customer who must declare the ICA in the destination member state. The supplier is therefore no longer required to register in the destination member state in the context of this order stock system. This system of order stock is not an option, but a compulsory application for each delivery when the conditions are met.

Measure for chain transactions

Chain transactions are consecutive deliveries between traders of the same goods whereby those goods are sent or transported across borders within the EU from the first supplier directly to the last buyer in the chain. The proposed scheme determines to which of the subsequent supplies in the chain the intra-community transport or dispatch is to be attributed. Only this supply will then be considered to be an intra-community supply. The other deliveries within the chain are regarded as domestic deliveries. The supplies in the chain prior to the intra-community supply take place in the member state in which the intra-community transport begins. The supplies in the chain following the intra-community supply take place in the member state where the intra-community transport ends. For the application of the scheme, it is first necessary to determine who in the chain qualifies as a broker to whom the intra-community transport or dispatch is attributed.

Increase in excise duty on diesel

The government proposes to increase the excise duty on diesel by 1 cent from 1 January 2021. The Cabinet also proposes to increase the excise duty on diesel by 1 cent per litre for 2023. The proposed increases are necessary in order to be able to pay for the proposals in the Climate Agreement.

Want to know more?

Would you like to know more about the 2020 Tax Plan, the proposed changes and what this means for you? If so, please contact us via email or by phone: +31 (0)88 277 15 00. We would be happy to assist you.