Last week, on March 11, 2025, the EU Ministers of Finance formally adopted the VAT in the Digital Age (ViDA) package, marking a significant step forward in modernizing the EU’s VAT framework. This adoption follows the political consensus reached at the ECOFIN meeting on November 5, 2024.
The ViDA package aims to streamline and harmonize VAT rules across the EU, reduce administrative burdens for businesses operating cross-border, and safeguard significant tax revenues for Member States. It is designed to align with the demands of a modern digital economy and the single market.
Key changes within the three pillars of ViDA include:
- Single VAT Registration and Reverse Charge: Effective from July 1, 2028: The One Stop Shop (OSS) will be expanded to reduce the need for multiple VAT registrations, covering more types of supplies.This includes the introduction of a specific scheme for the transfer of own goods and the mandatory application of the reverse charge mechanism in situations where suppliers are not established and not identified for VAT purposes in the Member State where VAT is due.
- Platform Economy: Between July 1, 2028 and January, 1 2030: The introduction of a deemed-supplier rule for platforms facilitating short-term accommodation rentals and passenger transport services by road; and
- Digital Reporting Requirements (DRR) and Mandatory E-invoicing: Effective from July 1, 2030, electronic invoicing will become the default system for intra-EU business-to-business transactions, with specific standards and requirements to ensure interoperability. The current recapitulative statements (EC sales listings) will be replaced with real-time Digital Reporting Requirements for cross-border supplies.
For more details on ViDA and the potential implications for businesses, please refer to our previous newsletter [link].
The ViDA reform represents a significant change for VAT in the digital economy, emphasizing increased use of data and technology. Tax authorities and businesses will need to adapt to the new digital and data landscape, requiring strategic planning and additional resources.
For a deeper discussion on how these ViDA pillars might affect your business, please contact our dedicated team.
