EU Tax News

Slovak VAT changes 2016

The new Slovak VAT Act will bring in changes to the Value Added Tax regime in 2016. The changes include:

Basic foodstuffs are lowered to the 10% reduced VAT rate
The introduction of the domestic reverse charge for supplies in the construction industry
Cash-based VAT remittance for supplies to delay paying output VAT due until they receive the VAT from their customer. In return, the customer may not recover the VAT till they have paid their supplier if they are using this regime.
The introduction of the reverse charge for non-resident VAT registered companies on domestic supplies
Increases in penalty regime
The right to recover VAT suffered on goods or services prior to VAT registration in certain circumstances

Italy e-book VAT rate cut

Italy is to press ahead with a reduction in the VAT rate on e-books, online newspapers or journals from 22% to 4% on 1 January 2016.

The reclassification will be in contravention of the European Court of Justice March 2015 ruling that e-books should be taxed at member states’ standard, higher VAT rate even if printed books are at a reduced rate. This was based on the rule that countries may only apply reduced rates on the exhaustive list of goods or services provided in Annex III of the EU VAT Directive. At the time of the completion of the VAT Directive, electronic books had not been developed.

Ireland raises Intrastat threshold

Ireland has raised its Intrastat reporting threshold on arrivals from €191,000 per annum to €500,000. The threshold for reporting dispatches will remain at €635,000 per annum.

Intrastat is the reporting regime for businesses to declare the movement of goods across EU borders. It is generally required on a monthly basis, with separate reports for goods leaving a country, dispatches, versus goods coming into a country, arrivals. It excludes goods’ movements into (imports) or out (exports) the European Union.