UK: 
USA:
New regulations to strengthen the fight against VAT fraud across the EU have been provisionally agreed by the European Council.
The mandate will see greater cooperation between EU member states, the European Public Prosecutor’s Office (EPPO), and the European anti-fraud office, OLAF.
Under the new framework, the EPPO and OLAF will benefit from enhanced access to real-time VAT data relating to cross-border transactions. This will include information currently held by Eurofisc, the EU’s anti-VAT fraud network.
Despite significant progress in recent years, including the digitalisation of billions of VAT transactions and tax authorities enjoying greater visibility of real-time VAT data than ever before, cross-border VAT fraud is still a major cost to the EU. Indeed, it is estimated to cost member state treasuries between €12.5 billion and €32.8 billion each year.
The new rules would allow the EPPO and OLAF to seize the data required to launch and support investigations into suspected cases of cross-border VAT fraud. This should speed up investigations and boost the EU’s ability to combat fraud at every stage.
Furthermore, businesses across the EU that operate in accordance with the bloc’s VAT legislation will be able to trade on a fairer, more even footing.
What does this mean for businesses?
Businesses that could be at risk of committing VAT fraud as a consequence of relying on ineffective, unreliable, or error-prone VAT processes should be hyper-aware of the potential penalties and increased likelihood of detection.
In the era of digitalisation, it is becoming more difficult with every passing month to evade tax authorities.
Therefore, leading global businesses are investing in solutions and setups to deliver best-in-class, fully-automated tax determination and reporting across multiple jurisdictions.
World-class tax technology provides an assurance of coverage, accuracy, and reliability, as well as a robust audit defence.
What happens next?
A decision from the European Parliament on whether it has opted to adopt the European Council’s framework is expected in July. After this, the Council will move towards formal adoption of the plans. The regulation will come into effect 20 days after it is subsequently published in the official journal of the EU.
The EU is already intending to make VAT reporting fully digital by 2030 for all companies that sell goods and services to businesses in other EU member states; a process that is also designed to support its battle against VAT fraud.
