Our September edition of the Global VAT Guide brings you key regulatory updates and developments from 17+ jurisdictions across the globe. From Anguilla to the United Kingdom, read on for a summary of what’s new and what it means for your business.
Anguilla
General Services Tax (GST) effective implementation 1 August 2025
On 29 July 2025, The Government of Anguilla enacted the General Services Tax Act, establishing the General Services Tax (GST), effective 1 August 2025.
The GST is chargeable at a standard rate of 13% on a wide range of services, including but not limited to:
- Tourism: short-term accommodation, tours, water sports, car rental, event planning, admission to attraction sites and entertainment
- Professional: legal, accounting, management and consultancy
- Construction: contracting, architecture and site preparation
- Communication: telephone, internet, cable, broadcasting and advertising
- Other services: property management, real estate, printing, landscaping and security
The registration threshold is EC$300,000* (~ €94,800) per annum. Mandatory registration is required short-term accommodation providers, auctioneers and statutory bodies providing taxable services.
Obligations of registered providers under the repealed Goods and Services Tax Act remain except for the first return for the General Services Tax which will be due on 30 September 2025 to allow for the reconfiguration of the Multi Tax Solutions (MTS). Thereafter, the return due date will revert to the 20th of the following month as legislated.
Brazil
Proposal to introduce 7% levy for Large Digital Platforms
On July 23rd, 2025, Brazil’s Chamber of Deputies received Complementary Law Project No. 157/2025, introducing a new tax – Social Digital Contribution (CSD).
If enacted, the CSD would apply a 7% quarterly levy on turnover from certain digital platforms’ supplies, such as:
- Advertising services in digital media that use data collected from users
- Sale or transfer of user-generated data collected from individuals in Brazil, or during their use of a digital platform
What’s excluded?
Supplies that are outside the scope of CSD are:
- Marketing of goods and services on the digital platform by the supplier itself
- Payment services
- Digital platforms that provide access to financial instruments and securities transactions
Who would be affected?
The proposed tax would target large digital platforms, domiciled in Brazil or abroad, whose global gross revenue from such taxable supplies in the previous calendar year, exceeds BRL 500 million (approximately €80 million).
If adopted the law would take effect 180 days after official publication.
Canada
GST, HST and the QST apply to no-show fees in restaurants in Quebec
Effective July 17, 2025, restaurants in Quebec can charge no-show fees of up to $10 CAD per person.
A specific rule provides that when an amount is paid following the modification, cancellation or failure to uphold a contract on the taxable supply of a property or service (other than a zero-rated supply), such as a meal, that amount (i.e. the no-show fee) is deemed to include the amount of the consideration for the taxable supply and the applicable taxes (5% GST or HST and 9.975% QST).
The restaurant owner is deemed to have collected the taxes on the supply calculated at the applicable rates for the consideration, and the person who made the reservation is deemed to have paid them.
This clarification ensures that no-show fees are properly integrated into Quebec’s indirect tax framework, avoiding ambiguity for businesses and tax authorities alike.
Chile
Clarification on VAT compliance for online low-value goods and platforms
On 30 July 2025, the Chilean Tax Authority issued Resolution EX. SII N°93, providing detailed guidance on VAT reporting obligations for sellers and platforms involved in the online trade of low value goods.
Key points
Registration requirements:
- Sellers of low-value goods and operators of digital intermediation platforms facilitating sales or services from non-resident providers must register under the simplified tax regime (see Resolution EX. SII N°84 published on 10 Jul 2025)
- Businesses already registered under this regime maintain their registration but must update details where applicable, using the option: “Sale of taxable goods and/or intermediation of sales of taxable goods”.
VAT exemptions under the Simplified Regime:
No VAT is due in the following scenarios:
- The seller, service provider, or buyer is already a VAT taxpayer in Chile
- The goods are not low value – the price of the item, considered individually, is equal to or greater than the sum of USD 500.01 including associated services such as shipping, insurance or packaging
- Goods are subject to special or additional import taxes or require authorisations/approvals from other organisations before entry
- The supply is exempt from VAT
Responsibilities of platforms vs sellers:
- When both the digital platform and the remote seller are registered under the simplified taxation regime, the digital platform operator is responsible for charging, declaring and paying VAT for transactions on its platform
- The seller is only responsible for VAT on sales made directly through their own channels, without the intervention of the digital platform
Reporting and compliance
- VAT is reported via the Digital VAT Form (F129) – a “pay only” return, with no entitlement to deduct tax credits on purchases
- The businesses registered under the simplified scheme are exempt from the obligation to issue tax documents for their operations
- The regulation specifies how to report corrections of the taxable base or tax due
Effective date and transition rules
- Resolution EX. SII N°93 takes effect 25 October 2025
- For registered taxpayers on a monthly tax period, the first period can declare and pay the VAT accrued between October 25-31, 2025, along with the VAT due for the tax period of November 2025.
Costa Rica
The Ministry of Finance postpones launch of TRIBU-CR to 6 October 2025
The Ministry of Finance of Costa Rica (Ministerio de Hacienda) announced a postponement of the launch date for the Integrated Tax Administration System (TRIBU-CR).
The initial launch was planned for 4th August 2025 but has now been suspended until 6th October 2025.
The delay is needed to migrate the database from the current system to TRIBU-CR, ensuring data integrity and a smooth transition.
The Treasury announced, in addition to the delay in the launch TRIBU-CR, the following changes are required:
1. Move the deadline for filing the September VAT return to 24th October 2025, to give taxpayers sufficient time to file and pay under the new system.
2. Make the new free Tico-Factura billing system available starting 6th October 2025. This version was initially scheduled for release on September 1, but TRIBU-CR must be active to enable it, so the release date must be changed.
Migration Scenarios:
- Comprehensive migration: All legacy systems shut down and data is fully transferred
- Incremental migration: Both old and new systems run in parallel, increasing risk of inconsistencies and operational costs
The Ministry continues to provide updates to ensure taxpayers are prepared for a smooth transition to the new system.
Czech Republic
Updated NACE codes – implementation from January 2026
The European Commission Delegated Regulation (EU) 2023/137 of 10 October 2022 introduces updated business activity codes (NACE Ref. 2.1), effective 1 January 2025.
The Czech Statistical Office plans to implement the new NACE codes from 1 January 2026. The Tax Office is preparing a separate solution for the purposes of filing Foreign VAT refund applications within the EU, which should be presented at the beginning of September. This will ensure the smooth submission of applications for VAT refunds for the period of 2024 within the deadline of 30 September 2025.
The update will help align business activity reporting with the latest EU standards, supporting accurate VAT filings and refund claims.
Deductibility – Unpaid purchase VAT must be offset after six months
In 2025, the Czech VAT Act was amended to require taxpayers to adjust input VAT deductions when related invoices remain unpaid for a specified period.
Effective 1 January 2025, the debtors must correct the VAT deduction in certain listed cases regulated via Section 74b of the Act on Value Added Tax.
The new obligation applies only to the right to a tax deduction that arose from 1 January 2025 i.e. for taxable supplies received with a date of completion from 1 January 2025.
Article 74b(3) of the VAT Act establishes the obligation of the debtor, who is the payer, to reduce the tax deduction applied in cases where the related receivable remains unpaid or is partially paid by the last day of the sixth calendar month immediately following the calendar month in which the payment became due. The tax deduction correction is made for the tax period to which this last day belongs.
On 27 June 2025 the tax authorities released a detailed guidance on the steps to complete to report the adjustments considering such adjustments become effectively reportable in July 2025.
The guidance also provides detailed information on how to proceed in case the payment is made after the respective input VAT deduction has been adjusted.
European Union
Enhancements to the Import One-Stop Shop (IOSS)
On 14 August 2025, the Council Directive 2025/1539 comes into effect. EU Member states must transpose the regulations in their national legislation by 30 June 2025.
The Directive changes the main VAT Directive 2006/112/EC to enhance the Import One-Stop Shop (IOSS) scheme for distance sales of low-value goods aiming to:
- Increase VAT compliance on imports
- Prevent distortion of competition
Key changes
Non-EU suppliers and deemed suppliers not using IOSS must appoint a local fiscal representative, except if established in certain listed countries with mutual assistance agreements.
The Member States will be allowed to require adequate guarantees proportional to risk when appointing intermediaries under the IOSS scheme.
Indirect customs representatives not acting as tax representatives may be held jointly and severally liable for import VAT.
The Directive previews that if the supplier or deemed supplier fails to comply with IOSS registration of VAT payment, the customer may pay the import VAT upon agreement. Even in those cases where the customer pays the import VAT, the supplier or deemed supplier remains liable in principle.
The Directive can be seen as a ‘soft launch’ of the IOSS registration mandate: the standard registration option remains, but terms may make it less feasible for businesses, encouraging adoption of the IOSS scheme.
Ecuador
Removing the 12-day limit on temporary VAT reductions
According to the Ecuadorian legislation, the President has the right to reduce the general VAT rate to 8% (from 15%) for all tourist services during National Holidays, but no more than 12 days in a year.
For 2025, these days were:
• 5 during the New Year’s holidays
• 4 during the Carnival in March
• 3 during Easter
From 14 July 2025, the 12-day limit was removed with the amendment to Art. 65 of the Internal Tax Regime Law, LRTI.
The Ecuadorian businesses and citizens will continue to enjoy the 8% VAT during the Autumn, Christmas and New Year Holidays, as this change demonstrates the President’s wish to exercise his right to reduce the general VAT rate on these specific dates.
France
Changes in VAT on energy products from 1 August 2025
The French Finance Act for 2025 introduced changes to VAT rates of the energy products, including subscriptions for electricity with a maximum power of 36 kVA or less (General Tax Code, Book 1, Art. 278-0 bis B).
From 1 August 2025, France aligns with European law and harmonises VAT rates on electricity, charging all electricity supplies at 20% VAT.
Bill No. 768 was published on the Senate website on 23 June 2025, proposing to reduce the VAT rate on energy, including all supplies of electricity, from the standard 20% to 5.5%.
The Bill is at first reading status in the Senate.
If accepted, the reduced rate would apply retroactively from 1 August 2025.
This measure reflects ongoing efforts to balance alignment with EU VAT rules and relief for consumers on energy costs.
Germany
Place of supply rules of virtual events
The Federal Ministry of Finance updated its guidance on VAT for online event services in the B2C sector, replacing the circular dated 29 April 2024.
Key clarifications:
• Live-streamed events are not electronically supplied services, but fall under § 3a Abs. 3 Nr. 3 UStG
• Recorded content accessed later is an electronically supplied service under § 3a Abs. 5 Satz 2 Nr. 3 UStG
• VAT exemptions may apply to live-streamed events and interactive live-streamed education
• Recorded streams and recorded lessons are excluded from VAT exemptions
Additional notes:
- Some changes also affect ticket sales and the application of reduced VAT rates
- The new rules apply to place of supply transactions executed after December 31, 2024
- For services performed before January 1, 2026, businesses may continue to rely on the Federal Ministry of Finance’s April 2024 circular without objection.
This update provides clearer guidance for businesses supplying virtual events in science, education, sports and entertainment, ensuring compliance with VAT rules and exemptions.
Reduced VAT on restaurants and catering to resume at 7% from January 2026
The German government plans to resume the reduced VAT rate for the catering industry.
Key details
- The change was included in the draft Budget for 2026, published in late July 2025
- If adopted, the 7% VAT rate will apply from 1 January 2026
- The Bundestag is expected to vote on the Budget at the end of November. The Bundesrat has to vote in December.
- The Budget will then be forwarded to the Federal President for signature.
This measure will restore the lower VAT rate for restaurants and catering, supporting the industry and consumers alike.
Italy
Updates to Reverse charge for Freight and Logistics
On 17 June 2025, Law Decree 84/25 was published in the Official Gazette of Italy, introducing changes to the reverse charge scheme for logistical labour and contracts, as outlined in the 2025 Budget Law.
The scheme aims to reduce fraud in the logistics sector and remains subject to authorisation from the European Council. The Agenzia Entrate has not yet issued full implementation guidance.
Key changes
The focus shifts from “place of supply of labour on capital goods” to “procurement contracts, subcontracts, and contractual relationships between companies for carrying out freight and logistical services”. This clarifies that VAT treatment depends on contractual arrangements with logistical service providers. The Circular 17/2025 suggests that providers should be identified with their economic activity – ATECO codes.
Transitional regime
In the interest of practicality and pending the EU authorisation, an optional transitional regime has been introduced in the Tax Agency Provision nr. 309107, (28th July 2025), clients of logistical suppliers may pay VAT on behalf of the supplier, who remains jointly and severally liable for the due tax.
Unfortunately, aspects of this transitional regime remain unclear, including tax point, application per contract or supplier and potential penalties.
The Italian Tax Agency has also introduced a new software to report transactions within the regime along with a guideline on how to fill it out, with a requirement to also submit contractual details.
While it is a challenge to introduce the reverse mechanism to such a significant sector, it is also meant to help and streamline business flows for any goods trader in Italy, while also reducing fraud and tax liability risk.
Major overhaul of VAT law
On July 14, 2025, Italy’s Council of Ministers gave provisional approval for the consolidation of existing Value Added Tax (VAT) legislation into a single legal text.
The new Consolidated VAT Law (Il Testo Unico IVA) consists of 18 sections and 171 articles. It completely reorganises the currently applicable Italian VAT legislation — such as DPR 633/1972, DL 331/1993, and DL 41/1995 — while also taking into account relevant European Union directives.
The restructured text aims to simplify the legal framework and ensure better compliance.
Next steps:
• Official adoption of the law, with an expected entry into force on 1 January 2026, although postponement until 2027 cannot be excluded.
• Publication of Implementing Regulations.
Kazakhstan
12% VAT on ChatGPT subscription from 1 August 2025
Kazakhstan tax authorities announced, starting from August 1, 2025, Kazakhstanis using ChatGPT will be required to pay 12% VAT on their subscription.
Legal entities or individual entrepreneurs registered as VAT payers in Kazakhstan should not be charged VAT upon providing their Business Identification Number (BIN) to the supplier. In case a valid VAT number is not provided, local VAT should apply and may not be deducted.
Poland
Right to amend VAT return 14 days after tax audit notification
As of 7 July 2025, the Polish Journal of Laws published an Act amending certain provisions of Fiscal Code and VAT Law.
As of 1 October 2025, when a taxpayer receives a notification of a customs and tax audit, they have a right to ament their reported VAT return and records with 14 days of receiving the notification. If a correction is submitted after that deadline, it will not be legally acknowledged.
If the amendment is made within the 14 day-period and results in an additional tax liability or correction of an overstated refund, and payment is made to the Polish tax authority, – the head inspectorate of the audit can assign a fine of up to 15% of the amount of the additional liabilities that have been reported.
This new rule is to help smooth out the flow of audits and give a clear option for taxpayers to correct their reporting. It is still vital to communicate with the inspectorate during an audit what changes would be best to submit on record.
Romania
VAT registration threshold to increase starting 1 September 2025
On 20 August 2025, the Romanian Tax Authority (ANAF) published a draft order to increase the VAT registration threshold from RON 300,000 to RON 395,000. This measure is expected to take effect from 1 September 2025 and is currently open for public consultation.
Taxable persons exceeding the new exemption threshold of RON 395,000 in August 2025 should submit a VAT registration request by 10 September 2025.
Taxable persons already registered for VAT by 1 September 2025, due to exceeding the old threshold of RON 300,000 may request to be removed from the VAT register – provided they have not exceeded the new RON 395,000 threshold at the date of the request.
Business impact
- The higher the threshold is expected to reduce administrative burden for smaller businesses.
- Companies close to the limit should monitor turnover carefully in August to avoid missed deadlines.
Romania’s new electronic import declaration system for 1 August 2025
As of 1st August 2025, Romania is rolling out the National Import System (SNI), which replaces the current import declaration processes.
To support the the transition, the Temporary Storage System (TSD) and Presentation Notice (PN) will remain in use to ensure transition into full electronic reporting. The PN system has been operational since 14 November 2024, and together with the TSD, enables secure exchange of information with economic operators. They enable the machine-to-machine digital communication as a formal method of submitting declarations and notices to Customs.
All exchanges will be made digitally, using XML structured files.
Key changes for businesses
- End of paper-based declarations – all filings will be digital, with electronic signatures
- Automated customs release – faster clearance with less manual intervention
- Direct link to the European Commission’s CERTEX system – validation of operator certifications
- Enhanced document handling – multiple types of documents can be exchanged and processed simultaneously
Business impact
The move to a fully digital customs environment is designed to:
- Simplify formalities
- Reduce processing and waiting times
- Streamline communication between businesses and Customs
As Customs are also entering the digital age of business reporting for their own means, it is ever more poignant for economic operators to stay ahead and be ready to adopt their internal systems and have all their accounts and documentation properly issues, reported and archived.
Slovakia
Guidelines published for Import VAT Postponement Scheme
On 25th July 2025 the Slovakian Tax Agency published the guidelines on reverse charge procedure for import VAT.
This is aimed at established businesses in Slovakia which hold a VAT number and the Advanced Economic Operator certification as previously mentioned.
Non-established businesses will be eligible for this scheme after 1 January 2026 and the practical examples laid out in these guidelines will provide insight on how to properly make use of this scheme.
The guidelines also make it clear that VAT registered businesses which fulfil the conditions for the postponed import VAT scheme will be automatically included in it, no form or request is required.
In turn, they will be obliged to calculate their import VAT i.e. self-assess in their periodic VAT returns. It also clarifies that the technical tax point is the day of the submission of the customs declaration as per standard procedure.
It also explains how exactly to fill the updated VAT return form when participating in this scheme.
These guidelines will be expanded upon as practical use cases crop up, and for smooth and proper compliance, this scheme will streamline and reduce the burden importation of goods into Slovakia.
Switzerland
Extension of the special rate of 3.8% for Accommodation beyond 2027
At its meeting on 13 August 2025, the Federal Council opened the public consultation on continuing of applying the special VAT rate of 3.8% for the hotel and parahotel industry for another eight years until the end of 2035.
The consultation will last until 13 November 2025.
Currently the special rate application should have to expire on 31 December 2027 and starting 2028 the accommodation services to be taxed at 8.1% standard VAT rate.
The Federal Council had previously recommended that the motion be rejected, as the tourism sector is in a much better economic situation today than at the time of the introduction of the special rate in 1996. A continuation of the special rate will reduce the federal government’s revenue, and these will have to be compensated for elsewhere.
Taiwan
Businesses making zero-rated supplies may switch to monthly returns only once per year
On July 30, 2025, the Taipei National Taxation Bureau of the Ministry of Finance reminded businesses via an official announcement that:
• Businesses making zero-rated supplies of goods or services under Article 7 of the Value-Added and Non-Value-Added Business Tax Act are entitled to apply to change frequency from bi-monthly to monthly, with the purpose obtain VAT refunds as quickly as possible .
• The tax authorities however remind businesses that once the change is approved, the filing schedule cannot be changed further within the same year.
• It’s further clarified that the term “same year” refers to the calendar year, which runs from January 1 to December 31.
United Kingdom
HMRC layout its vision for digital tax reporting for 2030
On 21st July 2025, HMRC published its Digital Transformation Roadmap, outlining its plans to digitise the UK’s entire tax reporting system by 2030.
This marks a shift from paper-based filings and communications to a real-time digital reporting model with deeper automation and system-to-system integration.
HMRC’s key goals:
• Full digitalisation by 2030 – Almost all transactions reported digitally
• Machine-to-machine communication – eInvoicing APIs and structured data reporting
• AI-enabled compliance – automatic error detection and compliance checks
• Streamlined auditing – automation and transparency at the core of reporting
What this means for businesses
While Making Tax Digital (MTD) already requires businesses to maintain digital profiles and online reporting, this roadmap goes futher:
- Seamless integration of ERPs, tax systems and eInvoicing
- Near real-time submission of transaction data
- Reduced need for manual reconciliation and error correction
Currently businesses risk human errors, delayed filings, time consuming reconciliations and gaps in audit trails with paper-based filing. Which is why HMRC wishes to streamline reporting into the digital world where records can be created and transferred in real-time, reducing human interaction and possible mistakes made along the way.
Large enterprises are already adapting their VAT software to:
- Automate VAT treatment based on supplier, delivery location and supply chain
- Extract and format ERP data for HMRC reporting
- Move away from manual spreadsheets and end-period adjustments
Why it matters
The roadmap reflects HMRC’s push to eliminate human error, cut delays and strengthen audit trails. For businesses, early adoption of digital-first tax processes will mean fewer compliance risks and greater efficiency.
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