Conservative MEPs secure EU support for small businesses over VAT rules

25-Mar-2015 @ 19:45

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Syed Kamall Syed Kamall

Amjad Bashir Amjad Bashir

Conservative MEPs have won an assurance from a leading EU Commissioner over the party's campaign to ensure new VAT rules do not have an adverse impact on micro-enterprises.

Frans Timmermans, effectively President Jean-Claude Juncker's number two in the Commission, promised that the new rules would be examined to head off any harm to small digital companies through unintended consequences.

The so-called VATmoss rules mean that, from January 1st this year, businesses have had to collect VAT for each individual country they sell to, and keep the records of all their transactions for years.

The rules were brought in to stop big companies from abusing international tax rules, but unfortunately lawmakers did not foresee the emergence of digital micro-businesses, such as the sellers of e-books.

Conservative MEPs - backed by Prime Minister David Cameron - have been lobbying the Commissio! n to introduce a threshold, to ensure the new rules do not create extra burdens for micro-enterprises.

The Commission initially sought to blame national governments, and in a debate with the European Commission in Brussels today, Conservative MEP for the East Midlands Andrew Lewer commented: "When it comes to people raising concerns about obstacles, the Commission simply blames someone else".

However responding to Mr Lewer's concerns, Commission vice-president Frans Timmermans promised to evaluate the effects of the new rules, saying "We would never want this legislation to have adverse effects on small entrepreneurs who are often at the cutting edge of creating new employment".

Conservative MEP for London, Syed Kamall, welcomed the change in heart of the Commission and said "I think we finally have a glimmer of hope for the many small businesses who have been so badly affected by this rule change."

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