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Taxation and Customs Union

VAT reports published

VAT refunds and reimbursements: A quantitative and qualitative study - Assessment of legislation

VAT refunds and reimbursements: A quantitative and qualitative study - Final Report

Revised version

VAT refunds and reimbursements: A quantitative and qualitative study - Assessment of legislation - REV 1

VAT refunds and reimbursements: A quantitative and qualitative study - Final Report - REV 1

The first part focuses on the conformity of national legislations both with the directive for cross-border intra-EU refunds (EC-2008/9) and with the CJEU case law related to domestic refund. It should be noted that, even if there is no harmonised legislation for domestic refund, the CJEU has identified limits to the freedom of Member States that have to be respected in any case.

The second part analyses the level of implementation of the law and tries to identify and quantify the consequences of such implementation highlighting problems and/or obstacles that taxable persons and VAT refund agents are facing while claiming refund of VAT both in the Member State of establishment and in another Member State. The study takes also into account the perspective and the difficulties of national tax administrations in administering and controlling such claims.

Restructured version (June 2019)

VAT refunds
VAT reimbursements
Technical Annex

Restructured version (June 2019)

After the end of the contract, the authors of the report have, at their own initiative, prepared a restructured version of the final report. The updated version presents the analysis in separate documents to recognise the differences in the legal and administrative frameworks governing VAT refunds and reimbursements.
The authors accept full responsibility for these changes.
Please be aware that the official version of the final report accepted by the Commission is the version previously published.

May 2019  
Study on the evaluation of invoicing rules of Directive 2006/112/EC
Executive Summary
The study provides an overview of the invoicing rules included in Directive 20016/112/EC and how they are implemented by Member States. The study has four main objectives:1. measuring the decrease in the administrative burdens for businesses; 2. assessing the degree to which the new rules on e-invoicing have contributed to the uptake of this technology; 3. assessing the role played by the new invoicing rules to support EU Member States’ efforts to tackle VAT fraud and improve tax compliance; 4. formulate evidence-based possible ways forward.

January 2019

The concept of Tax Gaps Report III: MTIC Fraud Gap estimation methodologies.

The Report explains the mechanism of VAT fraud; describes the VAT fraud types, insisting on the Missing Trader Intra Community (MTIC) fraud; reviews the MTIC fraud literature; describes VAT fraud estimation methodologies; lists the possible data sources for the estimation of VAT fraud and; reflects on the possibility of a European approach.

The report is the third one in a series and was preceded by the reports " The Concept of Tax Gaps – Report on VAT Gap Estimations" and " The Concept of Tax Gaps - Report II: Corporate Income Tax Gap Estimation Methodologies".

December 2018

Report from the Commission to the Council and the European Parliament on the effects of Articles 199a and 199b of Council Directive 2006/112/EC on combatting fraud

Based on Article 199a (3) of the VAT Directive, the Commission shall present an overall assessment report on the effects of the mechanism provided for in Article 199a (1) of the VAT Directive on combatting fraud.
Following Article 2 of Directive 2013/42/EU amending the VAT Directive, the Commission shall present an overall assessment report on the impact of the QRM measure.
As required by the VAT Directive, the report focuses on the effects of the measures provided for in Article 199a of the VAT Directive on combatting fraud and on the impacts of the mechanism provided for in Article 199b of the VAT Directive.

March 2018

Consolidated report on
Cooperation between Member States and Businesses in the field of e-Commerce/modern commerce



The aim of the report is to initiate and facilitate co-operation between businesses and tax administrations.On the one hand businesses and consumers must be enabled to benefit from the opportunities presented by this responsive and globalized economy, but on the other hand, tax administrations must ensure the effective collection of VAT and the detection of fraud and evasion. The report specifically addresses the issues related to access to information in the e-commerce supply chain and the exchange of this information. The report focusses on the understanding of the businesses` key functions and commercial background in order to identify who holds the information, the background of the transactions and understand the risks.

March 2018

Reform of rules on EU VAT ratesFinal Report TAXUD/2015/DE/333FWC No. TAXUD/2015/CC/131

The study investigates the impact of reforms that would allow Member States greater autonomy in running their domestic VAT systems, notably as regards rate-setting powers and the capacity to define which subsets of goods and services fall under which rate bands. These reforms also aim at abolishing the existing country-specific derogations and replacing them with rules applicable to all Member States.

The study assesses the impacts of such an enhanced flexibility on the proper functioning of the internal market in a multi-jurisdictional context, including the distortions that may arise, the risk of harmful tax competition, and the ramifications for the simplicity and efficiency of the VAT system as a whole (both in individual jurisdictions and intra-EU).

May 2017

Special scheme for small enterprises under the VAT Directive 2006/112/EC - Options for review

Final Report - Volume I

- Volume II

Under the VAT Directive, Member States can adopt specific schemes and measures to reduce administrative burdens on SMEs. These are regarded as territorial and unsuitable for trade in a cross-border environment. Given, in addition, recent developments towards taxation at destination and the Directive for modernising VAT for e-Commerce, an in-depth review of the special scheme for small enterprises (implemented in the Member States as “SME schemes”) and measures is timely.

This study analyses the functioning of the SME schemes and measures for SMEs against the backdrop of the SME environment. Based on findings from literature and contacts with tax authorities, businesses and experts, four policy options are formulated and assessed in accordance with European Commission Better Regulation Guidelines. Impacts of these options on businesses, Member States of the EU and the wider economy are reported.

May 2017

Analysis of the impact of the split payment mechanism as an alternative VAT collection method
Executive summary

The study illustrates the potential benefits as well as significant challenges related to the use of split payment as an alternative VAT collection method. Although split payment has high potential to reduce the VAT gap, if applied broadly across the EU, the cost of it through increased complexity of the VAT system, high administrative burden and significant impact on business’ cash flow may easily outweigh the benefits. Therefore, the study concluded that broad application of split payment is likely to be an unattractive policy tool, given significant rise in costs for business and authorities. However, it has characteristics that are very effective in reducing certain types of fraud and therefore may be suited as a targeted measure with limited scope.

December 2017

Study on the review of the VAT Special Scheme for travel agents and options for reform

The study analyses the functioning of the special scheme for travel agents set out in Articles 306 to 310 of the VAT Directive, which was put in place in 1977 as a simplification measure to avoid multiple registration obligations for businesses and to allocate VAT revenues to the Member State of consumption. The study reviews the relevant judgments by the Court of Justice of the European Union. It evaluates the impacts of established case law itself and those of national VAT laws deviating from the common EU rules. Finally, the study considers how the original objectives of the scheme can best be achieved and if there is still a need for a special scheme.


Options for modernising VAT for cross-border E-Commerce

This study, prepared by Deloitte, supports the December 2016 proposal by the Commission to modernise VAT for cross-border e-commerce. The Study is in three lots.
Lot 1 - Economic analysis of VAT aspects of e-Commerce
Lot 2 - Analysis of costs, benefits, opportunities and risks in respect of the options for the modernisation of the VAT aspects of cross-border e-Commerce
Lot 3 - Assessment of the implementation of the 2015 place of supply rules and the Mini-One Stop Shop


The Concept of Tax Gaps – Report on VAT Gap estimations

This report, prepared by the Fiscalis Tax Gap Project Group, provides an introduction to the methodologies currently applied to estimate tax gaps, with its main focus on VAT gap estimations. Tax gap estimations are rough indicators of revenue loss and over the last decade several methods have been developed by national (tax) administrations and international institutions to estimate these losses. This report presents the most important aspects of tax gap estimations in order to provide a better understanding of the estimation methodologies and to share information with a broader public.


2013 Update Report to the Study to quantify and Analyse the VAT Gap in 26 EU Member States


This report provides estimates of the VAT Gap for 26 EU Member States for 2013, as well as revised estimates for the period 2009-2012. It is a follow-up to the “Study to quantify and analyse the VAT Gap in the EU-27 Member States”, published in October 2014. See the press release ( IP/15/5592 ) and the frequently asked questions ( MEMO/15/5593 ).


Study on implementing the VAT ‘destination principle’ to intra-EU B2B supplies of goods

The study carried out by the Commission analyses five policy options for tackling two essential issues in the current VAT system: the additional compliance costs borne by businesses that conduct cross-border trade when compared to those businesses that only trade domestically and the occurrence of VAT fraud. The five policy options are designed to enable the implementation of a destination based VAT system across the EU.


Assessment of the application and the impact of the VAT exemption for importation of small consignment

Final report

Executive summary

The EU VAT Directive provides for a VAT exemption on the importation of small consignments below the EUR 10/22 threshold. This exemption is implemented by all 28 EU Member States. The Study carried out for the Commission presents an overview of the legal framework and procedures in place in the 28 EU Member States, as well as an economic analysis of the low value consignments market from 1999 until 2013, including an estimation of the potential VAT foregone by tax authorities due to this exemption


Economic Study on Publications on all Physical Means of Support and Electronic Publications in the context of VAT

Final report


Annex A

Annex B

Annex C

The study aims at assessing the substitutability between physical and electronically-supported publications; evaluating the impact of current VAT reduced rates; and evaluating the impact of extending either the reduced rate or the standard rate regime to all kinds of publications.


VAT rates structure

Final report


Annex 1

Annex 2

The study assesses the main economic effects of the current VAT rates structure and the economic effects that would follow from abolishing zero and reduced rates, under various hypotheses, including the introduction of compensatory measures.


Study on the economic effects of the current VAT rules for passenger transport

Volume 1

Volume 2

Volume 3

The current VAT rules for passenger transport activities can create distortions of competition, notably owing to differences among Members States in the application of VAT exemptions or reduced rates. Even where exemptions or reduced rates do not apply, the complexity of the current place-of-supply rules increase compliance costs and may cause voluntary or involuntary non-compliance.

Since the last large-scale review in 1997, the passenger transport sector has changed in a considerable way, as a result of the greater impacts of airline deregulation, implementation of rail concessioning, and the deregulation of bus transport. The cruise industry has also changed and experienced high growth. Hence, the importance of the distortions has increased.

This study contributes to the debate on possible options for reform by providing a summary of the current state of the passenger transport market, a review of the current VAT regime, an assessment of the impact of many of the distortions and an evaluation of some alternative VAT solutions on which a future improved VAT regime for the transport sector might be based.


Assessment of the application and impact of the optional 'Reverse Charge Mechanism' within the EU VAT system

A reverse charge mechanism (RCM) has been implemented in Member States' legislation in a number of specific cases as an "anti-fraud tool" in certain sectors that are vulnerable to fraud. In addition to measures that are based on derogations granted by the EU Council in accordance with Article 395 of the Directive 2006/112/EC (hereafter "VAT Directive") or the standstill provision of Article 394 of this Directive, Member States can apply the RCM, under certain conditions, to sectors or types of transactions that are enumerated in Articles 199 and 199a of the VAT Directive. This Study identifies the Member States that make use of the options to apply a RCM and evaluates the economic importance of the RCM, the cash-flow impacts of the RCM and the administrative burden on business of applying the RCM. See the summary .


2012 Update Report to the Study to quantify and analyse the VAT Gap in the EU-27 Member States

This report provides estimates of the VAT Gap for 26 EU Member States for 2012, as well as revised estimates for the period 2009-2011. It is a follow-up to the "Study to quantify and analyse the VAT Gap in the EU-27 Member States", published in September 2013. See the press release ( IP/14/1187 ) and the frequently asked questions ( MEMO/14/602 ).


Study to quantify and analyse the VAT Gap in the EU-27 Member StatesFinal Report

The study aims to understand the recent trends in the field of VAT collection better, by updating the VAT Gap estimates for 2000-2006 produced in the Reckon Report of 2009 and by providing estimates for the VAT Gap for the period 2007-2011.
Press release IP/13/844 and frequently asked questions ( MEMO/13/800 ).


Study on the feasibility and impact of a common EU standard VAT return

Study on the feasibility and impact of a common EU standard VAT return


Study on applying the current principle for the place of supply of B2B services to B2B supplies of goods

A feasibility study carried out by PwC to examine the option of applying the current principle for the place of supply of B2B services to B2B supplies of goods (place of establishment of the customer), without following the physical flow of the goods within the EU.


Study on VAT in the public sector and exemptions in the public interest (final report of a follow up study)

The study analyses and measures the issues arising from the current VAT treatment of public bodies and activities carried out in the public interest. It also identifies possible options for the future, and measures their impact. The views expressed by the contractor do not necessarily reflect those of the European Commission. The Commission accepts no responsibility or liability whatsoever with regard to the information in this study


Report from the Commission to the Council on supplies on board of means of transport

Expert Study ant its appendices

Directive 2006/112/EC (the 'VAT Directive') provides that the Commission presents to the Council a report on the VAT treatment of goods and services, including restaurant and catering services, supplied to passengers on board means of transport. The report focuses not only on the place of taxation but also on exemptions currently applied in this sector.
The expert study of 8 February 2012 conducted by PwC for the Commission on this subject is published together with this report.


VAT - Expert study on the issues arising from a reduced time frame and the options allowed for submitting recapitulative statements

Appendix 1

Appendix 2

Appendix 3

Appendix 4

Final report on the application of Article 263(1) of Directive 2006/112/EC (amended by Directive 2008/117/EC), implemented since 1 January 2010.
Article 263(1) aims at ensuring that information on intra-Community supplies of goods, including deemed supplies, and services is collected and exchanged between Member States more quickly, so as to enable quicker detection of fraud, in particular VAT carousel (missing trader) fraud.
The report was drawn up for the European Commission by PWC in 2011 and focuses on the consequences for business arising from a reduced time frame for submitting recapitulative statements and the possibilities offered to Member States to derogate from the normal rule.


A retrospective evaluation of the elements of the VAT system

Executive Summary

Formal answers to the Evaluation Questions

In December 2010, the Commission signed a contract for a retrospective evaluation of the consequences, in economic terms, of the functioning of the most pertinent elements of the current EU VAT system, as identified in the "Green Paper on the future of the VAT". The final report was submitted by the external consultants on 5 December 2011.
This evaluation looked into the design and implementation of certain VAT arrangements, assessing their effectiveness and efficiency in terms of results and impacts they had created. It examined their relevance and their coherence with the smooth functioning of the single market and the requirement to avoid distortion of competition specified in Article 113 of the Treaty on the Functioning of the European Union.


VAT in the public sector and exemptions in the public interest

The study analyses and measures the issues arising from the current VAT treatment of public bodies and activities carried out in the public interest. It also identifies possible options for the future, and measures their impact.

See the summary


Study of the VAT treatment and quantification of vouchers at an EU level for the provision of economic analysis in the area of taxation


The objective of the quantitative part of this study is to contribute to the economic justification for making a legislative proposal to resolve the issues surrounding the VAT treatment of vouchers, in particular issues arising from mismatches between Member States. Therefore, the scope of the study is focused on both the actual and potential cross-border exposure. Even where there is limited evidence of actual cross-border trade, the potential may be sufficient to give rise to concerns.
The qualitative part of the study aims to provide an overview of the VAT rules that apply throughout the EU to prepaid telephone vouchers. This part only addresses pre-paid telephone vouchers because, according to the results of the study, this type of voucher is considered the most important in terms of monetary value.


Study to quantify and analyse the VAT gap in 25 EU Member States

The study analyses the gap between the amount of VAT due and the amount received in 25 Member States. See also the press release ( IP/09/1655 )


Study on the VAT invoicing rules contained in the VAT Directive

A study on the VAT invoicing rules contained in the VAT Directive ( 2006/112/EC ) was carried out for the European Commission by PricewaterhouseCoopers. It aims to look at the four principal areas of invoicing - the requirement to issue an invoice, the content of an invoice, electronic invoicing and the storage of invoices - with a view to mapping the existing legislation in all Member States, analysing burdens on business and Member States' control needs, and providing recommendations for a more harmonised and modern set of VAT invoicing rules.


Reduced VAT for environmentally friendly products

The study examines the potential use of reduced VAT on environmentally friendly goods and the current application of reduced VAT on energy consumption by households. The analysis is carried out in the context of EU policy approach to climate change and energy security, including interaction with other policy instruments at the EU and national levels. The core of this study focuses on what role - if any - should VAT rate policy play in underpinning these objectives.


The Potential Benefits of using Differential VAT for Environmental Purposes

The study looks at the potential impacts of changing current VAT rates to align them with environmental goals in some specific cases - domestic energy supply, food and dairy products, insulation materials, white goods and boilers. It finds that the suitability of differential VAT as a policy instrument differs greatly across products, in particular depending on the nature of the market failure in consumer behaviour which the VAT rate would be trying to correct.


Study on the possible impact of measures envisaged for fighting VAT fraud (Timeframes)

In its Communication on the need to develop a coordinated strategy to fight against fiscal fraud ( COM/2006/254 ) the Commission suggested a series of measures to improve the exchange of information. One of these measures is the reduction of timeframes for the collection and exchange of information on intra -Community transactions. This measure was pointed out by the Council in its conclusions of 5 June 2007 as a priority measure to implement. This study analyses the possible impact of this measure on businesses active in intra-Community trade.


Study in respect of introducing an optional reverse charge mechanism

One of the debated solutions to combat certain types of VAT fraud is the introduction of a general reverse charge mechanism in the VAT system. The European Commission therefore decided to explore the impact of the introduction in certain Member States of such a system.


Reduced VAT applied to goods and services in the EU Member States

The study examines the theoretical and empirical merits of four different arguments for reduced VAT rates. Two based on efficiency grounds: Can reduced VAT increase efficiency by increasing productivity or by reducing structural unemployment? Another two based on equity grounds: Can reduced VAT enhance equity by improving the income distribution or by making particular products more accessible to the entire population?


Study on reduced VAT applied to goods and services in the Member States of the EU

The study examines the impact of reduced VAT rates and of derogations, not only for locally supplied services, but also more globally. The effects on income distribution, the informal economy and compliance costs for businesses were also taken into consideration. Read more .




Economic effects of the VAT exemption for financial and insurance services

The study carried out by PricewaterhouseCoopers aims to increase the understanding of the economic effects of the VAT exemption for financial and insurance services. The views expressed in the report are solely those of the authors and do not necessarily reflect the views of the European Commission, nor bind the Commission. The analysis and conclusions presented are the sole responsibility of the authors.

Management summary

Main report



COM(2004) 855

Report from the Commission to the Council and the European Parliament: Fifth report under article 12 of Regulation (EEC, Euratom) No 1553/89 on VAT collection and control procedures - see also annex


COM (2004) 260

Report from the Commission to the Council and the European Parliament on the use of administrative cooperation arrangements in the fight against VAT fraud.

Press Release IP/04/523 .


COM (2001) 599

Report from the Commission on reduced VAT rates drawn up in accordance with Article 12(4) of the Sixth Council Directive of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes - Common system of value added tax: uniform basis of assessment.


Taxation - Requirements imposed by Member States for invoices

Study on the requirements imposed by the Member States, for the purpose of charging taxes, for invoices produced by electronic or other means (Tender XXI/98/CB-5010).


COM (1999) 185

Commission Report on the Community Art Market
Report from the Commission to the Council on the Examination of the impact of the relevant provisions of Council Directive 94/5/EC on the competitiveness of the Community art market compared to third countries' art markets.

Press Release IP/99/274 .


A study of the VAT regime and competition in the field of passenger transport

Passenger transport is taxed on the basis of distance covered in each Member State and tax is collected at internal frontiers. Many different tax rates apply to passenger transport across the EU with some Member States applying exemptions and zero-rates. Even within the same Member State competing modes of passenger transport may be taxed differently. The study explores the economic, fiscal and practical effects of a number of alternative taxation structures for passenger transport services performed within the EU.


VAT on financial services

Report giving a detailed description of a modified form of the cash flow system of VAT (The TCA-ADD Report).

A study of Methods of Taxing Financial and Insurance Services, carried out for the European Commission by Ernst & Young, 1996 (The 'blue book').

Note: The Commission has from time to time sought consultants' reports on VAT on financial services and insurances. We frequently receive requests for access. To facilitate this, they are published on the website to the extent that the contents permit.

For the TCA-ADD Report, publication is restricted to the introduction and an extensive executive summary. The more detailed annexes of this report focus on field testing of the TCA model. This was undertaken with the assistance of several financial institutions and insurance companies who participated on an expressed commitment of confidentiality. As the annexes contain extensive data which was supplied on this understanding, these parts of the report are not being made publicly available.


Study on the application of Value Added Tax to the property sector

This study performed for the European Commission deals with the application of Value Added Tax to the property sector in 15 Member States of the European Union.



Second report from the Commission on the application of the common system of VAT, submitted in accordance with Article 34 of the Sixth VAT Directive.