E-commerce platforms could face new regulations that would make them legally responsible if they sell products from companies that do not pay value-added tax. A majority of diplomats from EU countries have already backed changes to the bill, according to a working document obtained by EURACTIV.com.
Croatia, Finland, Poland and Slovenia have raised objections to the proposals to make e-commerce retailers liable for VAT, according to the draft, which is dated 29 August. The proposal has not yet been agreed. All 28 member states must unanimously sign off on any EU-wide legal changes related to tax.
If it is passed, the proposal would force online marketplaces and platforms to collect VAT on behalf of companies whose products they sell if those companies are not legally established in an EU country.
A company in the EU that uses its warehouses to distribute products from firms outside the bloc could be held “jointly and severally liable for payment of VAT” under the proposed rules. Member states would be able to exempt retailers from paying VAT on behalf of the companies whose products they store if they can prove that they “acted in good faith” to try to make sure those firms pay VAT in the EU.