New EU value-added tax (VAT) rules to further level the playing field among different accommodation providers
On 8 December 2022, the European Commission presented a series of measures that will impact VAT systems across the EU. The new rules will help to level the playing field amongst accommodation providers by requiring online accommodation platforms to collect the VAT and remit it to tax authorities.
The proposal also makes an important reference to one of the key issues concerning VAT and competition between different accommodation providers – STRs can be provided VAT-free which impacts the final price and competitiveness of them towards traditional, regulated accommodations such as hotels. According to a study on VAT in the digital age, 70% of suppliers on platforms are not registered for VAT purposes.
More information about the package is available here.