The article discusses the EU’s longstanding VAT exemption for financial services, noting that the exemption was introduced in 1977 and remains in place across EU member states, Iceland, and the UK. It reviews the European Parliament’s February 2026 draft report, which calls for modernising the tax framework, highlights the 91 sector‑specific taxes that have emerged, and explores options such as abolishing the exemption for B2B services or differentiating between B2B and B2C. The piece underscores the hidden costs, market distortions, and competitiveness concerns that the current exemption creates.
It proposes abolishing the exemption for services supplied to taxable businesses (B2B) to allow input VAT deduction and reduce hidden costs, while retaining some protection for consumers.
The report identifies 91 sector‑specific taxes, including financial transaction taxes and bank levies.
The exemption was introduced in 1977 as a practical workaround.
The withdrawal left a clear policy gap, prompting the report to call for coordinated reforms with existing financial transaction taxes and bank levies.
The exemption remains in place in EU member states, Iceland, and the UK.
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VatCalc · about 1 hour ago
EU Parliament has tabled more than 200 amendments to its draft report on a coherent tax framework for the financial sector, with VAT reform at the centre. The proposals aim to narrow the long‑standing VAT exemption for financial services, tax fee‑based B2B services, consolidate the Insurance Premium Tax into VAT, and modernise rules for neobanks, crypto and other digital financial services. A parliamentary vote is scheduled for 26 April 2026, with a vote expected in May and potential plenary adoption in June.
e-Invoice.app · 2 days ago
The European Commission will host a public workshop on 27 April 2026 to review the revision of Directive 2014/55/EU on e‑invoicing in public procurement. The event will outline potential policy measures, gather stakeholder feedback, and discuss the three policy options for the revision. The outcome will influence upcoming compliance requirements, including the ViDA reform that will mandate structured e‑invoicing for intra‑EU B2B transactions by July 2030.
Bloomberg Tax · 2 days ago
The article examines how fully automated, AI‑run companies—termed zero‑person companies—challenge existing VAT rules. It explains that while such entities can perform all operational tasks, they still require a human link for legal accountability, and their place of establishment for VAT purposes is determined by where central administration effectively occurs, often defaulting to the registered office. The piece also discusses the low likelihood of fixed establishments arising solely from cloud infrastructure and outlines compliance implications for tax authorities.
VATCalc · 5 days ago
The EU VAT reforms tracker outlines a comprehensive schedule of upcoming legislative and compliance changes across the EU, including new VAT registration thresholds, e-invoicing requirements, import VAT liabilities, and the Carbon Border Adjustment Mechanism. Key dates range from 2025 to 2035, covering digital services, e-commerce, and cross‑border trade. The tracker serves as a reference for businesses to anticipate and adapt to evolving EU VAT rules.
European Parliament · 8 days ago
The European Parliament and Council have agreed on a comprehensive reform of the EU Customs Code aimed at tackling the surge in e‑commerce parcels. Key measures include a new handling fee for individual parcels from non‑EU countries, treating e‑commerce platforms as importers, a new EU Customs Authority in Lille, and a customs data hub to be mandatory by 2034.
e-Invoice.app · 8 days ago
The article outlines a CFO-focused readiness scorecard for e-invoicing, highlighting gaps in regulatory awareness, technical infrastructure, process maturity, vendor coverage, and organisational alignment. It details key mandates in Belgium, France, and Germany, and stresses the importance of early assessment to avoid penalties and lengthy implementation cycles.
