On 25th February 2019, the Commission published Council Implementing Decision 2019/309 permitting Lithuania to introduce the reverse charge mechanism to supplies of hard drives, as of 1st March 2019.
Lithuania has discovered missing trader fraud relating to its cross-border supplies of electronic goods such as laptops, mobile phones, tablets and hard drives. Lithuania maintains that the VAT fraud scheme is so prevalent, it has had a significant detrimental impact on the country’s state revenue.
Despite Lithuania implementing various measures like electronic reporting requirements to combat this form of tax evasion, they have not been effective in curbing VAT fraud.
This new rule will allow Lithuania to apply the reverse charge to supplies of hard drives until 28th February 2022.