The article discusses the EU’s longstanding VAT exemption for financial services, noting that the exemption was introduced in 1977 and remains in place across EU member states, Iceland, and the UK. It reviews the European Parliament’s February 2026 draft report, which calls for modernising the tax framework, highlights the 91 sector‑specific taxes that have emerged, and explores options such as abolishing the exemption for B2B services or differentiating between B2B and B2C. The piece underscores the hidden costs, market distortions, and competitiveness concerns that the current exemption creates.
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VatCalc · about 11 hours ago
The article reviews progress on the EU's ViDA VAT reform pillars, noting technical discussions from the 42nd VAT Expert Group and Future of VAT Group meetings. It highlights key dates such as the 13 February 2026 approval of EN16931, the 1 January 2027 effective date for Phase 1 Single VAT Registration changes, and the €10,000 threshold debate. While the Digital Reporting Requirements pillar is slated for July 2030 and the Platform Economy pillar for July 2028–January 2030, implementation details remain unsettled.
EY Tax News · 5 days ago
The European Commission released the minutes from its 51st Group on the Future of VAT meeting, held on 3 March 2024, which discussed the ViDA package’s e‑invoicing, digital reporting, platform economy VAT and single VAT registration provisions. Key dates include the start of OSS guidelines on single VAT registration on 1 January 2027 and several upcoming GFV/VEG meetings in mid‑2026 that will shape the final Explanatory Notes for 2027.
The Invoicing Hub · 7 days ago
The European Commission has launched a public consultation and a "Reality Check" event to shape the upcoming revision of EU e-invoicing rules, including the e-invoicing directive and EN 16931 standard. The consultation runs until 10 June 2026, while the interactive event is scheduled for 27 April 2026. The Commission expects the revised directive to be adopted in Q4 2026 as part of the Single Market Strategy.
VatCalc · 8 days ago
The European Commission is advancing a deemed supplier regime for ride‑and‑accommodation platforms, with a voluntary launch in July 2028 and mandatory compliance by 1 January 2030. Draft explanatory notes were issued in Q1 2026, with final notes expected in Q2 2027, and the EC will confirm member‑state conditions by 31 December 2028. The regime also revises the short‑term accommodation definition to 30 days and will be evaluated for effectiveness by 1 July 2033.
Vijesti · 16 days ago
The EU has proposed a law allowing governments to temporarily reduce VAT rates to counteract price rises, particularly in fuel, and protect citizens’ standard of living. The proposal is aimed at mitigating inflationary pressures in Montenegro and has broad political support. It follows examples such as Spain’s reduction of fuel VAT from 21% to 10%.
VATCalc · 17 days ago
The EU Parliament has reopened debate on the optional reverse charge mechanism, which is set to expire on 31 December 2026. While the tool has proven effective in curbing missing trader intra‑community fraud in high‑risk sectors, concerns remain about VAT distortions and the need for complementary digital reporting controls. The review signals that reverse charge will stay part of the anti‑fraud toolkit but will be increasingly paired with real‑time transaction monitoring under the ViDA framework.
It proposes abolishing the exemption for services supplied to taxable businesses (B2B) to allow input VAT deduction and reduce hidden costs, while retaining some protection for consumers.
The report identifies 91 sector‑specific taxes, including financial transaction taxes and bank levies.
The exemption was introduced in 1977 as a practical workaround.
The withdrawal left a clear policy gap, prompting the report to call for coordinated reforms with existing financial transaction taxes and bank levies.
The exemption remains in place in EU member states, Iceland, and the UK.
This summary was published on VATfaqs.com on 16 February 2026. It relates to VAT developments in European Union. The original source is LinkedIn Article by Rui Marques.
