VAT on e-Services: How New Rules Affect Businesses
VAT on e-Services: How New Rules Affect Businesses

Summary/Abstract: From 1st January 2015, in the European Union will enter into force a new VAT regime for business-to-consumer suppliers of telecoms, broadcasting and electronic services. This regime will have an impact on businesses engaged in the supply of certain products and services over the Internet. This article is a literature review. It is aimed to provide an analysis of the European VAT regime applicable to electronic services and clarify some key issues like: what are e-services, what are the changes and how the businesses are affected by these new rules. The paper also approaches issues such as: the change of the rules regarding VAT place of supplying and the introduction of the VAT Mini One Stop Shop (MOSS). The main conclusion is that the change in the place of supplying rules will serve to negate the VAT advantages associated with Internet companies which locate their invoicing functions in a Member State that is different from where they locate their substantial activities.

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