Summary
Summary
The ViDA VAT reform implementation strategy is transparent and gradual, highlighting key milestones for successful realization of the reform.
The Directorate General for Taxation and Customs Union published on September 24, 2025, the roadmap for the gradual implementation of the VAT in the Digital Age(ViDA) package. The implementation strategy is a direct and transparent move, showing all stakeholders that the ViDA project is transitioning into production mode. Soon, the first practical technical steps will be taken.
The ViDA reform is based on the three-pillar structure. The package consists of the implementation of EU-wide cross-border B2B e-invocing and digital reporting, the modernization of VAT rules for the platform economy, and the evolution of the Single VAT Registration (SVR) mechanism.
The implementation roadmap is precisely what it should be: a clear, gradual implementation strategy that highlights the milestones to be achieved for the successful realization of the VAT in the Digital Age reform. As the primary contributor to the ViDA reform, the European Commission will closely monitor the realization of each milestone within the agreed-upon timeframe.
The ViDA package, when fully implemented, is expected to generate significant revenues for the EU’s public coffers. Businesses contracting in the EU will also benefit from the modernization of the EU VAT framework. The preliminary official analysis speaks for itself: the revenue of around EUR 160 billion for the EU budget, and EUR 50 billion in savings for business stakeholders.
Impact of VAT in the Digital Age
VAT in the Digital Age represents unquestionably one of the most crucial VAT reforms in the last twenty years. The impact of this legislative package will cover a broad scope of taxable persons, and on the other hand, will demand the close cooperation of various EU central and national public institutions.
Businesses that make distance sales of goods or services within the EU internal market will need to adapt to new rules on electronic invoicing and digital reporting. Digital platform operators that facilitate short-term accommodation rentals, as well as platform operators that facilitate passenger transport services, will bear additional VAT compliance responsibilities.
The Single VAT Registration pillar will reduce bureaucratic and compliance expenses for EU and non-EU businesses operating in more than one country, through the statutory reduction of the number of legislative triggers that lead to mandatory VAT registration in different Member States.
The businesses designated as electric vehicle charging operators, which operate in more than one Member State, will be among the categories of businesses that will benefit from the ViDA reform. This benefit derives from the drastic reduction of the VAT compliance responsibilities, which will come from eliminating the obligation to register in each MS where the power stations are made available to users.
Gradual Path to ViDA
The first substantial milestone of the reform will come into effect on January 1, 2027. The designated providers of charging stations for electric vehicles will be able to profit from the OSS simplified reporting mechanism.
Then comes the second significant jump, which will considerably expand the EU’s public coffers through a substantial reduction in VAT fraud resulting from non-compliance by SMEs operating via digital platforms in the short-term rental industry and passenger transport activities.
This will be enforced through the introduction of the deemed supplier concept for all platform operators participating in this market. The designated platform operators will act as deemed suppliers in various scenarios, thereby making each transaction facilitated by them VATable.
From July 1, 2028, most of these platforms will act upfront through terms and conditions as deemed suppliers, or will act severally liable for reporting of VAT for each transaction facilitated by them. Meaning, e.g., if host X doesn’t report a transaction facilitated by platform Y, the platform Y will have an obligation to do so.
The ultimate goal of ViDA for the platform economy is that every transaction must be reported and linked to the VAT that has been remitted.
When it comes to the Platform Economy pillar, Member States have the option (some will undoubtedly use it) to postpone the implementation of this pillar until January 2030.
The most complex pillar is the reform of the EU’s cross-border B2B reporting system. The plan is to implement a cross-border, real-time digital reporting system based on e-invocing for most EU B2B transactions. From the perspective of complexity, investment, and planning, this pillar is the most challenging one.
The first part of the puzzle is expected to take effect on July 1, 2030. From that date, all EU B2B transactions should be reported digitally to the EU-based central VIES platform. The final part of this reform is expected to be completed by January 1, 2035. Until that date, Member States that have implemented domestic e-invoicing regimes prior to 2024 will be required to fully harmonize their domestic frameworks with the EU-wide requirements.
Takeaway
Following the ViDA’s milestones roadmap, the first significant changes will already come into force in a bit more than a year from now. From that moment on, substantial reforms will come into force. The stakeholders, as well as all institutions that will contribute to this reform, should already initiate the preparation of the next steps.
Author: Aleksandar Delic
There is no doubt that ViDA reform requires significant technological modernization of IT systems within EU institutions, as well as national authorities of each Member State. On the other hand, EU businesses will face the need to invest in internal IT systems to meet new reporting requirements or to find an accredited third-party service provider to fulfill B2B e-invoicing and digital reporting requirements.
And yes, of course, let’s not forget the EU compliance intricacies that ViDA will create for digital platform operators and e-commerce vendors.
Indirect Tax Manager – E-Commerce
The EU ViDA reform, or VAT in the Digital Age, is a comprehensive legislative package designed to modernize VAT rules, introduce EU-wide cross-border B2B e-invoicing, improve platform economy compliance, and streamline the Single VAT Registration mechanism.
The first major milestone takes effect on January 1, 2027, when designated providers of electric vehicle charging stations can utilize the OSS simplified reporting mechanism. This is followed by subsequent phased reforms in 2028, 2030, and full harmonization by 2035.
Platform operators facilitating short-term rentals, passenger transport, or other services will have additional VAT compliance responsibilities, including acting as deemed suppliers responsible for reporting VAT for each transaction they facilitate.
The Single VAT Registration pillar reduces bureaucratic burdens by minimizing mandatory VAT registrations in multiple Member States, saving time and compliance costs for EU and non-EU businesses operating across borders.
The cross-border B2B e-invoicing system is the most complex pillar, requiring real-time digital reporting for EU B2B transactions. Member States must harmonize domestic e-invoicing systems with EU requirements by 2035, demanding significant IT modernization.
: Businesses should invest in internal IT systems or use accredited third-party providers to meet new e-invoicing and digital reporting requirements, update processes for platform economy transactions, and stay informed about phased milestone deadlines.