VAT & Indirect Tax Intelligence
VAT news digest
Curated from global sources. Twice-weekly digest, free.
From 1 January 2026, Italy has enacted a new automated VAT assessment regime for omitted annual returns, allowing the tax authority to calculate VAT due using e‑invoicing and other digital data. The automated determination must be completed by 31 December of the seventh year following the missing return, and penalties are capped at 120% of VAT due, reducible to one‑third if paid within 60 days of notice.
In today's VAT update, we highlight key developments across Europe, Africa, and APAC, including the VAT implications of transfer pricing adjustments and recent changes to VAT relief and refund systems in Ukraine and Egypt. Additionally, notable court rulings and regulatory updates in countries such as India and Belgium are also discussed. These changes aim to improve tax efficiency and clarify existing rules, with significant implications for businesses operating globally.
Today's VAT news highlights key developments in Europe and the Americas, with notable rulings from the EU High Court and the French Supreme Court. Updates to VAT regulations in Serbia and guidance on VAT liability for electric vehicle charge points in the UK are also featured. Additionally, a review of Illinois sales tax and recent briefs from Revenue and Customs provide further insight into the evolving tax landscape.
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The Swedish Ministry of Finance has appointed a special commissioner to lead a comprehensive inquiry into the implementation of the EU’s ViDA directive. The commission, launched on 5 February 2026, is expected to submit its findings and legislative proposals by 30 November 2027, with Sweden required to meet EU digital reporting obligations by 1 July 2030. The review will assess mandatory e‑invoicing for domestic transactions and cross‑border B2B digital reporting.
Oman will introduce mandatory e‑invoicing for B2B and B2G transactions using a 5‑corner Peppol network, and for B2C via a clearance model through OTA’s Fawtara platform. The rollout begins with a pilot in August 2026, followed by mandatory phases in February 2027 and August 2027 for all VAT‑registered taxpayers.
Italy’s e‑invoicing system will adopt new SDI technical specifications effective 15 May 2026, adding VAT‑group checks, expanded accreditation limits, and a sports‑worker exemption code. The ViDA directive will require Italy to shift from its centralized SdI model to a decentralized reporting architecture by 1 January 2035, and to adopt the EN16931 standard. These changes affect ERP vendors, e‑invoicing service providers, and all businesses issuing electronic invoices in Italy.
On 13 May 2024, the CJEU ruled that contractual price adjustments in intragroup transactions are not considered a supply of services for VAT purposes, meaning such adjustments fall outside the scope of VAT. The decision applies across the EU, including Portugal and Luxembourg, and underscores the need for case‑by‑case assessment of transfer pricing adjustments. The ruling does not change VAT rates or thresholds but clarifies the treatment of these adjustments.
Ukraine will abolish its VAT exemption for imported parcels under €150 from 2027, requiring marketplaces to collect 20% VAT at point of sale. Citizen‑to‑citizen parcels under €45 will remain exempt if free and not for resale. The reform, based on draft laws 15112‑D and 12360, is expected to raise about UAH 10 billion annually.
Egypt’s Tax Authority has issued new executive instructions establishing a unified VAT refund framework. The new system introduces an electronic completion platform, shortens refund processing to 20 days, and sets a two‑day review period with email notifications for missing documents. The framework also prioritises white‑listed companies and requires electronic invoice statements for refund claims.
The Supreme Court dismissed Uttar Pradesh’s attempt to levy a 21% state VAT on natural gas transported from Andhra Pradesh to Uttar Pradesh, ruling the transaction is an interstate sale governed by the Central Sales Tax Act. The decision upheld a 2012 Allahabad High Court judgment that quashed UP’s assessment orders against Reliance Industries, Tata Chemicals and IFFCO. The ruling confirms that gas transported through common pipelines remains an interstate sale even when co‑mingled.
Belgium’s FPS BOSA has released updated guidance on its mandatory 2026 B2B e-invoicing regime, clarifying invoice rejection, reverse charge wording, and Peppol delivery monitoring. The update introduces new rules for handling incorrect recipients, softens automatic rejection of reverse charge invoices, and confirms that suppliers must be registered in Peppol to receive self‑billing documents.
The Delhi government has lowered the VAT on Aviation Turbine Fuel (ATF) from 25% to 7% for airlines operating in the capital. The reduced rate will apply for an initial six‑month period, providing relief to airlines and passengers amid rising fuel costs.
Slovenia’s parliament approved emergency legislation that temporarily cuts VAT on a basket of staple foods to 5% and on household energy supplies to 9.5% for nine months, effective 17 May 2026. Businesses must update invoicing, pricing and ERP systems to reflect the new rates and ensure compliance with digital reporting requirements.
Egypt’s Tax Authority has issued new executive instructions to streamline VAT refund processing. The reforms cut the refund period to 20 days, shorten review time to two working days, and set clear notification and document‑submission deadlines. The changes aim to improve speed, accuracy and digital integration for taxpayers.
The Delhi government has reduced the VAT on aviation turbine fuel (ATF) from 25% to 7% effective 16 May 2026. The change applies to airlines purchasing fuel at Delhi airports, providing significant cost savings for the aviation sector.
Kenya's Finance Bill 2026 expands VAT coverage to include a wide range of digital financial and payment processing services, effective 1 July 2026. Commissions earned by payment service providers on these services will be standard-rated for VAT, replacing previous exemptions. The change requires PSPs to reassess VAT treatment, update invoicing systems, and review contracts and pricing structures.
