Estonia: Blocking EU VAT Reform Targeting Digital Platforms
Estonia is opposing a proposed EU VAT reform that would impose new liabilities on digital platforms, including short-term accommodation and passenger transport companies such as Bolt Technology OU and Airbnb Inc. The Estonian Finance Minister highlighted that taxing services merely because they are provided via digital platforms would create an additional burden on small and medium-sized enterprises (SMEs) and distort competition.
Rather than the proposed mandatory approach, Estonia has suggested a voluntary opt-in system, allowing each country to decide its own path. This discussion comes after EU finance ministers previously failed to reach an agreement on the Value Added Tax in the Digital Age (ViDA) in their May meeting. The ViDA proposal aims to tackle tax avoidance and evasion, which cost member states significant revenue.
Countries like Italy and Spain are advocating for the reform to collect more VAT revenues from companies like Airbnb and Booking.com. Meanwhile, Bolt has been actively lobbying the Estonian government to resist the measure, according to EU diplomats.
Despite the broad support from 26 member states, achieving unanimous agreement remains a challenge. Belgium’s Finance Minister is working to find a compromise that satisfies all member states.
Source: news
