The proposed EU directive on the introduction of a standard VAT return for all countries garners disagreement in the states called upon to evaluate it. Germany and France have already expressed perplexity. According to the Italian Government, it would produce significant cash problems for our public budget, since it would involve the abolition of the VAT advance.
This is how the Italian Government, represented in the Senate Finance Committee by the undersecretary of the Ministry of Economy and Finance Luigi Casero, expressed itself on the proposal for a directive submitted to the evaluation of our Parliament. Furthermore, Casero added, it should be verified whether problems could arise with regard to the controls carried out by the Revenue Agency.
The parliaments of the 28 member countries of the European Union have been called to evaluate the proposal for a directive of the EU Council on the introduction of a standard VAT return, which overcomes the variability of the declaration requirements currently required by the various states. The proposal for a directive also contains other amendments to the European regulations on value added tax, related to the unified return and with a view to simplifying the obligations of companies aimed at favoring intra-community trade.
Launched at the end of 2013, the proposal provides for the preparation of a single standardized declaration model, which may contain a maximum of 26 boxes, against the 586 that make up the current Italian declaration. The suppression of the declaration on the importation of goods and of the annual VAT data communication is also envisaged.
The German and French Parliaments have already expressed their views on the proposal, pointing out some critical aspects of the proposal, which therefore does not appear to have the road paved before it. Among the reasons for dissent, there are also those expressed by the Italian government: the prohibition that would be introduced to impose payments on account of VAT and the risks that the systems to combat fraud would be weakened. In particular, the opinion of the French Parliament states that "the proposed standardization risks jeopardizing the effectiveness of the fight against VAT fraud, as tax administrations would have less information".
Our Parliament has just started examining the proposal. The speaker in the Senate, Francesco Molinari, of the Movimento 5 Stelle, explained that the directive would introduce a standard VAT return with predetermined content, comprising five items that member states can bring to twenty-six.
The deadline for submitting the return could not be less than one month nor more than two months, starting from the expiry of each tax period. For subjects with a turnover not exceeding two million euros, the possibility of quarterly tax periods would be envisaged, except in specific cases in which it is necessary to prevent evasion and fraud. The payment of the tax would in any case take place upon expiry of the term within which the declaration must be presented, while the possibility of establishing a different deadline for the payment or of collecting provisional advances would be eliminated.
Under the proposal, Member States could require VAT returns to be submitted electronically. In the perspective of standardization adopted by the European Commission, the cases of possible exemption from the standard declaration would be limited; moreover, for the Member States, the possibility of imposing further obligations regarding VAT returns would be excluded.
In his speech in the commission, to illustrate the position of the Italian Government, Undersecretary Casero affirmed that the Italian position is in favor of the adoption by the European Union of common fiscal policies, which may concern the matter of VAT, especially in a perspective of simplification in favor of businesses. However, the current proposal presents problems, such as the abolition of advances and the current relationship between the VAT return and the single model. While deeming that there shouldn't be any particular criticalities with respect to the control activities, Casero reserved the right to carry out the appropriate investigations, involving the Revenue Agency.
