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As a broad-based consumption tax, VAT is both a primary and growing source of revenue for all EU Member States. However, according to the European Commission, the current VAT regime is too burdensome and complex for businesses and leaves the door open to fraud when it comes to cross-border trade (loss of revenue due to fraud is estimated at EUR 50 billion annually in the EU). Furthermore, the current VAT rules do not take into account technological developments, changes to business models as well as the globalisation of the economy. The conclusion is obvious: the VAT system needs to be modernised.
It is against this background that on 7 April 2016, the Commission published an Action Plan(1) aimed at modernising the current EU VAT system to make it simpler, more fraud...
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