Compliance Services

The Swedish Tax Agency is reviewing its VAT-related processes with a means of digitising these, for the creation of a more automated, streamlined and effective process. It is expected that relevant stakeholders in the country will convene to discuss the issue in the next few months. Specific areas which are being considered are:

• VAT listings
• SAF-T
• Continuous Transaction Controls (CTC)- Governments introduce CTCs to more effectively counter tax fraud and increase revenue. As part of introducing CTCs in their mandates, governments often require invoice data to be sent to tax authorities in real-time or require invoices to be cleared by the government before they are paid;
• Real-time invoice reporting
• Mandatory invoicing

Tungsten Network is interested in developments relating to e-invoicing in Sweden. We are monitoring these developments and will keep you updated.

Last month we outlined Serbia’s plan to implement e-invoicing in phased approach across the country within the next 2 years. Alongside the introduction of e-invoicing, we can expect some changes to the content of the invoice itself.

In late 2021, the Minister of Finance in Serbia adopted a ‘rulebook’, which stated the following:

• If a VAT invoice is submitted in e-invoice form, the place of issuance of the invoice does not need to be included;
• There is a new mandatory element for a Serbian invoice- the advance payment invoice for an advance payment invoice.

This ‘rulebook’ aims to synchronise rules on the issuance and content of VAT invoices with new regulations being introduced in respect of e-invoicing.

B2G e-invoicing regulations are already in place for multiple regions in Belgium (Brussels, Flanders and Wallonia). B2G e-invoicing will now be extended to the suppliers of all public entities in all regions across the country. The obligations will be implemented in a phased approach, based on the size of public contracts.

The Belgian government has approved a royal draft decree to this effect. This draft law has not yet become law so the proposed dates are provisional, however, it is expected that by September 2023 the obligation will extend to all public contracts, irrespective of the value of the public contact.

It is however expected that contracts below 3000 Euros will be exempt from the obligation to use e-invoicing.

Last month we communicated that Belgium had taken some VAT-related measures as a direct result of the pandemic.

Belgium has also introduced further VAT reforms – from 1 March 2022 to 1 July 2022, the VAT rate for electricity will be reduced from 21% to 6%.

In line with what we are seeing in many other European countries, France is implementing further fiscal measures as a direct response to the Covid pandemic.

Further to the 2022 French Finance Law, the reduced rate of 5.5% will continue to apply to specific products such as gels and face masks, until 31 December 2022.

The French Finance Law also stipulates that the reduced 5.5% VAT rate will apply to the following products:

• Certain foodstuffs
• Products intended to be used in the preparation of these foodstuffs
• Products intended to supplement or replace these foodstuffs.

The tax administration in Paraguay (SET) have issued some revised timeframes around e-invoicing in the country. Resolution 105/2021 replaces the former resolution 95/2021, outlining a new proposed schedule.

Paraguay aims to implement the e-invoicing mandate in a phased approach, incorporating ten stages, using the National Integrated System of Electronic Invoicing.

The new resolution has outlined some key dates:

• 1st July 2022- the mandate is expected to start for certain sectors (such as specific retailers, and other businesses who had already been deploying e-invoicing);
• 1st October 2024- the last group of taxpayers will take up mandatory e-invoicing;
• 1st April 2022- voluntary e-invoicing becomes possible.

The timeframes demonstrate Paraguay’s intention to implement e-invoicing across the country over a period of 2 years, allowing affected entities to gradually transition to the new e-invoicing system.

The Paraguay tax authorities aim to keep taxpayers informed as to when they should start e-invoicing, via a fiscal mailbox and the SET website.

Fiscal measures that countries are deploying also demonstrate how obligations for digital businesses are coming more sharply into focus.

Mexico is planning to enact a 2% Digital Services Tax on commission received by online marketplaces. Funds raised will be spent on improving Mexico City’s infrastructure.

This builds on earlier taxation developments in the digital landscape in Mexico which took place in Mexico in June 2020, where Mexico applied 16% VAT on digital services provided by foreign businesses.

The Mexican Tax Authorities have published a list of non-resident companies that have registered for VAT further to the introduction of Mexico’s new digital VAT obligations in June 2020. There is a wide scope of companies affected, showing the extent of companies affected by the digital VAT obligations.

With digital obligations becoming more prevalent globally, we can expect to see other countries enacting similar measures in 2022.

With the upcoming e-invoicing mandate expected during 2023 and new recent SAFT-requirements, Poland is overseeing a busy period in the re-structuring of its fiscal operations.

Another significant change being introduced in Poland is the introduction of new VAT groups.

Poland will permit the formation of VAT groups in Poland- these are groups which will typically be formed based on financial, economic or organisational ties. Taxpayers can be based in Poland or abroad- but if the latter, it is expected that they will conduct their business through a branch in Poland. Groups must be formed for a minimum of 3 years.

A representative of the group will perform any VAT- related responsibilities. Any transactions between the members of the same VAT group will not be subject to VAT- although transactions with entities outside the VAT group will in effect be deemed to be transactions with the entire group.

This comes with some benefits- transactions between members of the same group will not be subject to VAT and the corollary of reduced administrative-related duties relating to VAT.

These regulations are expected to come into effect on 1 July 2022.

The Polish Ministry of Finance has this month published the new JPK_FA structure. Alongside the new structure, an information brochure has been published, outlining the main changes that have been introduced.

The new structure can be located on the Polish National Tax Administration website.

The Central Board of Indirect Taxes & Customs (CBIC) of India recently issued a notification (01/2022) lowering the threshold for mandatory e-invoicing under Goods and Services Tax (GST).

As of present, e-invoicing is mandated for all taxpayers whose annual revenue is ₹50 crore or above. From 1st April 2022, the revenue threshold for mandatory e-invoicing will be reduced to ₹20 crore. By extending the scope of e-invoicing, the government is expected to enhance tax compliance among small businesses in the country.