Welcome for Prime Minister’s push on ‘VATmess’ at EU summit

19-Mar-2015 @ 11:30

Syed Kamall Syed Kamall

Amjad Bashir Amjad Bashir

Amjad Bashir Amjad Bashir

 A senior MEP campaigning to change new EU rules on VAT, that have caused a number of very small online businesses to stop trading, has welcomed the planned intervention by Prime Minister David Cameron at today’s EU summit.

Syed Kamall, Conservative MEP for London and leader of the European Conservatives and Reformists Group in the European Parliament, has been working with a number of those businesses affected in lobbying the European Commission for a solution.

The so-called VATmoss rules mean that, from January 1st this year, businesses have to collect VAT for each individual country they sell to, and keep the records of all their transactions for years. The rules for VATMOSS 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 e-books sellers or even sellers of knitting patterns. The extra burdens have caused many of these entrepreneurs to stop trading altogether.

David Cameron will use today’s summit to lobby European Commission President Juncker to find a solution. Dr Kamall has been pushing for an EU wide threshold to be introduced for micro-businesses. He has lobbied a number of European Commissioners and has secured agreement from the commission to bring a delegation of affected businesses to Brussels to seek a solution.

He said: “VATmoss is a typical example of a piece of EU law that had one set of intentions, but it has brought devastating unintended consequences for businesses that are often run out of people’s living rooms. A law intended to stop companies like Amazon from avoiding tax has actually caused many digital entrepreneurs to close down entirely.

“I and my colleague Vicky Ford MEP have been seeking a solution with the European Commission for several months. We have found a sympathetic ear but not much willingness to act so I hope that David Cameron’s intervention will help move things along.

“We will continue to campaign until this outdated law is amended or mitigated, preferably by introducing an EU wide threshold so that the smallest businesses can continue to trade online in the EU’s common market without reams of crippling bureaucracy.”

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