Tax and Legal Alert – July 2021

Law no. 227/2015

In the Official Gazette no. 630 of June 28, the Emergency Ordinance no. 59/2021 for the amendment and completion of Law no. 227/2015 regarding the Fiscal Code was published.

Date of entry into force: 1 July 2021.

The normative act transposes in the national legislation the provisions of paragraph 2 and 3 of Directive (EU) 2017 / 2.455 and Directive (EU) 2019 / 1.995, regarding certain VAT obligations in relation with the supply of services and distance sales of goods.

The main provisions of the Ordinance are the following:

Amendments are made to the definition for the intra-Community distance sales of goods in order to be clear that, this also applies if the supplier is indirectly involved in the transport or dispatch of the goods.
The definition for distance sales of goods imported from third territories or third countries is introduced.
Provisions are introduced for the use of online interfaces such as an online marketplace, platform, portal or other similar means, which facilitate the distance sales of goods imported from third territories or third countries in batches with an intrinsic value not exceeding EUR 150, as well as the supply of goods in the European Union by a taxable person not established in the European Union to a non-taxable person, the taxable person using them shall be deemed to have received and delivered the goods themselves. In these situations, the VAT becomes chargeable when the payment has been accepted. Also, the delivery from the seller of the goods to the interface (buyer-reseller from the VAT perspective) is exempt from VAT.
Changes are made regarding the place of supply in the case of distance sales of goods – it is considered to be the place where the goods are when the shipment or transport of goods to the customer ends.

Details regarding the place of supply are introduced in the case of distance sales of goods imported from third territories or third countries as follows:

For goods imported into a Member State other than that in which the dispatch or transport ends, the place of delivery shall be deemed to be the place where the goods are at the time when their dispatch or transport to the customer ends;
For goods imported into the Member State where the dispatch or transport ends, the place of delivery shall be deemed to be that Member State, only if the VAT on those goods is declared under the import scheme.

The threshold for distance sales is changed from 35,000 euro / year to 10,000 euro / year. If the threshold is not exceeded, the place of delivery is considered to be the state where the supplier is established. The same provisions regarding the place of supply apply for telecommunications, television and radio broadcasting services, electronic services.
The VAT exemption for the import of goods is introduced when VAT has to be declared under the import scheme and when, at the latest at the time of presentation of the import declaration, the individual registration code for VAT purposes, for the application of the special regime, of the supplier or of the intermediary acting on his behalf has been supplied to the competent customs office of the Member State of import.
Non-Union scheme – the non-EU taxable person providing services may apply the special scheme according to which he is registered for VAT purposes in a single EU Member State, for services provided to non-taxable persons in the EU.
Union scheme (OSS) – from 1 July 2021 the special regime for VAT return and payment, for intra-Community distance sales of goods, for deliveries of internal goods by electronic interfaces that facilitate these deliveries and for services rendered by persons becomes operational established in the European Union, but not in the Member State of consumption. In the absence of the application of the special OSS regime, the supplier would be required to register for VAT purposes in each Member State in which he supplies goods or services to his customers, if he exceeds the ceiling of 10,000 euros / year. A special VAT return is submitted quarterly by the taxable person to the competent tax authority, by electronic means, whether supplies of goods have been made or services have been provided for which uses the special OOS regime.
The Special Regime for the distance sale of goods imported from third territories or third countries (import scheme) is introduced in lots with an intrinsic value no exceeding EUR 150, except for goods subject to excise duty.
Introduce the Special Mechanism for Declaring and Paying VAT on import which applies when the import scheme is not used. As an exception, a VAT rate of 19% will be applicable to all goods imported under this procedure.
Invoicing of intra-Community distance sales of goods for taxable persons applying the Union scheme is not mandatory.