Archived website

This online community was active in conjunction with the Digital Agenda Assembly 2012 and is now archived and available for institutional memory. You can now join the discussion at https://ec.europa.eu/digital-agenda/en/community

Tax harmonisation

Laurence's picture
Submitted by Laurence on Wed, 2012-05-02 21:01

VAT and other taxes vary considerably across the EU. This frequently impacts where e-commerce and other digital media business locate themselves. Personally I believe that businesses should be making their decision not based on tax but on other fundamental business practicalities. It would be great if the EU could address this matter over time which would ensure that business leaders take the tax variable out of their decision equation.

Group audience: 
Interesting!
2 users have voted.

Comments

Kasia's picture
Submitted by Kasia on Mon, 2012-05-07 15:51

VAT is indeed one of the most complex aspects of single market and, needless to say, issue of great sensitivity to national treasuries.
The Commission envisages quite a substantial reform aimed at simplification and better enforcement of VAT rules as of 2013. Details can be found in the Communication adopted in December 2011: http://ec.europa.eu/taxation_customs/resources/documents/taxation/vat/ke...

Let's hope for a positive impact on development of cross-border online services!

Interesting!
0 users have voted.

griff's picture
Submitted by griff on Wed, 2012-05-09 10:16

In case you are not minded to read 17 pages on VAT:

The public consultation yielded frustration with the fragmented 27 different VAT regimes in the EU creating complication and therefore cost to doing business in the EU which is either passed on to citizens, or is a barrier to SMEs doing cross border business. Some responses noted that it is in fact easier to deal with non-EU countries.

Meanwhile VAT represents about 20% of revenue for governments on average, so they are sensitive to change.

Regarding VAT reform, a uniform VAT EU rate is recognised as unworkable (just as there is no uniform sales tax in the US). But equally the principle of taxing at the origin (seller) rate is moving to the destination (buyer) rate - also I believe this system used in the US (though for a while there was no sales tax on online purchases).

The destination base model would remove the obstacle mentioned by Laurence affecting where businesses locate. Retailers generally prefer the origin system as it is much simpler for them - but it penalises retailers in high rate countries.

(Much) more detail in the report: http://ec.europa.eu/information_society/digital-agenda/daa/images/Have-y...

Interesting!
0 users have voted.

mearsj's picture
Submitted by mearsj on Mon, 2012-06-04 13:02

In their paper, "Tax considerations of cross-border,
multichannel retailing", PWC make some good points:
- pricing products, to account for the widely different VAT rates that apply to an online customer’s home country
- some retailers can’t build an indirect tax team
- double paying customs duties
- unawareness of consumer rights in different countries (typical return rates around 30%)

Interesting!
0 users have voted.

mearsj's picture
Submitted by mearsj on Mon, 2012-06-04 13:02

In their paper, "Tax considerations of cross-border,
multichannel retailing", PWC make some good points:
- pricing products, to account for the widely different VAT rates that apply to an online customer’s home country
- some retailers can’t build an indirect tax team
- double paying customs duties
- unawareness of consumer rights in different countries (typical return rates around 30%)

Interesting!
0 users have voted.

zola4522's picture
Submitted by zola4522 on Mon, 2013-01-07 08:38

IT certification brand around the globe. IT certifications with up to date course material is provided by Pass4sure. With the assistance of IT certification exams provided by Pass4sures you will have outstanding prospects in the field of IT and your success will be guaranteed in your first attempt.
http://www.test-king.com/

Interesting!
0 users have voted.

zola4522's picture
Submitted by zola4522 on Mon, 2013-01-07 08:40

IT certification brand around the globe. IT certifications with up to date course material is provided by Pass4sure. With the assistance of IT certification exams provided by Pass4sures you will have outstanding prospects in the field of IT and your success will be guaranteed in your first attempt.
http://www.test-king.com/ 70-515 test king
http://www.test-king.com/exams/640-802.htm 640-802 test king
http://www.test-king.com/exams/VCP-510.htm VCP-510 test king
http://www.test-king.com/exams/350-001.htm 350-001 test king

Interesting!
0 users have voted.

williamburton's picture
Submitted by williamburton on Wed, 2013-03-13 11:31

"I believe that businesses should be making their decision not based on tax but on other fundamental business practicalities". I agree with your statement. Actually, Alexa von Tobel, founder of financial-planning site LearnVest.com, said, “If you have debt, pay down debt; if you don’t have it, fund your emergency savings.” However, reducing debt comes first. Tobel went on to say that contributing to savings is futile if you are still accumulating a high percentage of interest on old credit card debt.She added a good rule of thumb: “Anything you can’t remember what you spent it on [soon after spending it], isn’t a good idea.”

Learn more:http://personalmoneynetwork.com

Interesting!
0 users have voted.

Submitted by laurenbeckerbeck on Fri, 2013-03-29 17:21

I agree with you to a certain point that businesses should not make their decision on taxes, but there are several countries who do not make it easy for clients to start a new business. The financial burden is therefore especially during the first stages of business creation the main reason why decisions are made on taxes.
Academic works about this topic can be ordered at http://gwriters.co.uk/dissertation/dissertation-writing-service

Interesting!
0 users have voted.

People

competencesmarocaines.org's picture
fhardes's picture
fredriklinden's picture
keneastwood's picture
Nicholas Bentley's picture
JacintaArcadia's picture
Loankanassy's picture
Kasper Peters's picture
Kristijan Jakic's picture
lpujol's picture
Digital Agenda Assembly engagement
glqxz9283 sfy39587stf02 mnesdcuix8
glqxz9283 sfy39587stf03 mnesdcuix8
glqxz9283 sfy39587stf04 mnesdcuix8