You may have come across it already: ViDA. VAT in the Digital Age. Most sellers are still pushing it to the back of their minds, because the start date seems far away. Still, it is worth knowing what is coming, because quite a few things are about to change for e-commerce businesses.
We sat down with Joke, our compliance expert at Staxxer, to understand what exactly changes and what that means for your online store.
Why ViDA is coming in the first place
When we ask Joke where ViDA comes from, her answer is clear: every year the EU misses billions in VAT revenue because of cross-border fraud and a lack of cooperation between countries. Countries simply do not know what is being declared elsewhere.
The EU wants to close that gap, the so-called compliance gap, by connecting systems and digitising reporting. ViDA is the answer to that.
The three pillars of ViDA
ViDA consists of three major parts, each with its own timeline. Joke explains them one by one.
Pillar 1: Digital reporting and e-invoicing (from 1 July 2030)
All B2B transactions, both local and cross-border, will have to be reported digitally. That starts with e-invoicing: invoices have to be issued in a standardised European format, so the data can be exchanged automatically.
Both the supplier and the recipient report the transaction, so the two can be matched. Fraud becomes visible almost immediately. As Joke points out: the EC Sales List will eventually disappear, because information is exchanged in real time.
Pillar 2: The platform economy (from 1 July 2028)
Platforms for short-term accommodation rental (think Airbnb) and passenger transport (think Uber) become responsible for remitting VAT on behalf of their sellers, if those sellers do not have a valid VAT number.
As Joke notes, this is the least relevant pillar for most e-commerce businesses. Do you sell physical products through your own webshop or a marketplace? Then pillar 2 has little direct impact on you.
Pillar 3: Single VAT registration (from 1 July 2028)
For many e-commerce businesses this is the most far-reaching pillar, and also the most positive one. As Joke explains, it comes down to one core idea: you will no longer need a separate VAT registration in every European country.
This becomes possible through a significant expansion of OSS, the system that lets you remit VAT for several EU countries from a single country. Where OSS today mainly covers distance sales to consumers, it will soon also cover local B2C sales and movements of goods between your own VAT numbers.
For those movements of goods, a new TOOG return (Transfer of Own Goods) is being introduced. Today, moving your own stock to another EU country still triggers a mandatory local VAT registration in that country, plus an EC Sales List.
From 1 July 2028 that requirement disappears: you report all your stock movements between EU countries through a single return within the expanded OSS system. This is a major simplification, especially for e-commerce businesses working with fulfilment centres in several countries, for example through Amazon FBA.
Something changes for domestic B2B sales in another EU country as well. Think of a sale from your German stock to a German business customer: the goods stay within that country. Today that often means a local VAT registration, German VAT on your invoice and a return in Germany.
Joke explains that such a local sale will soon be handled through a reverse charge. The buyer then becomes responsible for remitting the VAT, which means you as the seller no longer need a local VAT number for it.
There do appear to be exceptions, though, and they are important to keep an eye on. Do you sell B2B from foreign stock to buyers in other countries? Then it looks like a local VAT number in that country will remain necessary for the time being, at least until 2030.
B2C sales from that same foreign stock are expected to fall under the expanded OSS. That is Joke’s assessment based on what is on the table right now. But this is a point on which the EU still needs to provide more clarity.
As Joke emphasises: for businesses with a simple B2C structure and movements of goods, ViDA works out very well. For those who also sell B2B or work with foreign stock, part of the current obligations will simply remain.
What does this mean for your situation?
That depends on how you sell.
Do you only sell B2C and move goods between countries? Then ViDA is good news. You will need fewer VAT registrations. The admin shifts to OSS, which is a lot more manageable than separate registrations per country.
Do you also sell B2B to buyers in other EU countries, or ship from foreign stock? Then less changes than you might hope. VAT numbers in those countries remain necessary, and part of the current obligations simply stays in place.
How are we preparing at Staxxer?
We are following the developments closely. As Joke indicates, she expects more clarity on the practical implementation per country only after the upcoming EU meeting in November. But we are not sitting on our hands.
From early 2027 we will be running a series of webinars on ViDA, so you will not be caught off guard as the deadline approaches.
Do you already have questions about what ViDA means for your situation? Get in touch. Or have a look at our ViDA page for more information.
