ARTICLE · 20 MARCH 2025

EU Council Adopts VAT In The Digital Age Package

KPMG in Cyprus

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On 11 March 2025 the EU Council has adopted a comprehensive set of laws aimed to align the European Union's VAT rules with the digital transformation of the economies.

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Michael C. Grekas

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On 11 March 2025 the EU Council has adopted a comprehensive set of laws aimed to align the European Union's VAT rules with the digital transformation of the economies. The changes will significantly affect provisions of the EU VAT Directive, EU Council Regulation regarding VAT administrative cooperation and EU Council Implementing Regulation in the following areas:

Digitalization of VAT reporting obligations for companies that sell goods and services to businesses in other EU member states by 2030.
Online platforms are obliged to pay VAT on short-term accommodation rentals and passenger transport services in most cases where individual service providers do not charge VAT.
Enhancement and expansion of online VAT one-stop-shops, eliminating the need for businesses to undergo costly VAT registrations in each member state where they carry out business activities.

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