In early January, the town of Mauerbach saw the Austrian government put forward a tax reform package which it believes will ensure fairer taxation of its citizens so that in the words of Finance Minister, Hartwig Löger, “working people will finally get more life”. The measures relating to VAT are as follows:
Launch of online marketplace VAT liability
Following the path taken by the UK and Germany, Austria plans to introduce marketplace liability for the unpaid VAT owed by traders using their platforms. Looking to the German system as a model, Austrian marketplace operators will be required to keep records detailing specific information about both the traders and their transactions. These records would be provided to the Austrian tax authorities if requested, helping them monitor whether traders are complying with their VAT obligations.
This measure is expected to come into effect from 2020 at the earliest. As yet no legislation has been drafted.
Withdrawal of low value consignment relief as of 1st January 2020
Currently, as in other EU Member States, imported parcels of goods entering Austria, with a value not exceeding EUR 22 are exempt from import VAT. Recently, this exemption has become contentious because of concerns over values deliberately being misreported to avoid paying VAT.
Austria is deliberating the removal of this relief a year before its planned abolishment at the EU-level comes into effect.
VAT Rate on Digital Books Cut to 10%
As of 1st January 2020, the Austrian rate of VAT applicable to supplies of electronic publications such as digital books and journals will be equalised with that of their printed counterparts. This means that they will be taxed at the reduced 10% rate of VAT. Now, these supplies are subject to Austrian VAT at the 20% standard rate.
If the impending changes impact your business or indeed, if you have any questions on the above, please do contact us.