EC prepares reform on VAT rules for member states, including Romania

The European Commission plans to give up the VAT exemption for cross-border transactions between companies. The situation will be later settled through payments between states. This is one of the measures the European Commission wants to initiate to modernize the current VAT system for states and companies, including Romania, reports local Profit.ro. The EC plans a wide reform to reduce the annual losses of over EUR 150 billion resulting from uncollected VAT across the European Union. A third of the total losses, or EUR 50 billion, come from failing to collect VAT on cross-border transactions. This amount could be reduced by 80% if EC introduces these new measures, based on the European Commission estimates. Romania’s total losses from uncollected VAT amounted to EUR 7.66 billion in 2015, according to EC’s most recent data. The European Commission’s reform could thus generate large amounts of money for Romania, possibly even billions of euros per year. editor@romania-insider.com