REPORT on the proposal for a Council directive amending Directive 2006/112/EC on the common system of value added tax as regards the identification of taxable persons in Northern Ireland
29.10.2020 - (COM(2020)0360 – C9‑0279/2020 – 2020/0165(CNS)) - *
Committee on Economic and Monetary Affairs
Rapporteur: Irene Tinagli
(Simplified procedure – Rule 52(1) of the Rules of Procedure)
DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION
on the proposal for a Council directive amending Directive 2006/112/EC on the common system of value added tax as regards the identification of taxable persons in Northern Ireland
(COM(2020)0360 – C9‑0279/2020 – 2020/0165(CNS))
(Special legislative procedure – consultation)
The European Parliament,
– having regard to the Commission proposal to the Council (COM(2020)0360),
– having regard to Article 113 of the Treaty on the Functioning of the European Union, pursuant to which the Council consulted Parliament (C9‑0279/2020),
– having regard to Rule 82 of its Rules of Procedure,
– having regard to the report of the Committee on Economic and Monetary Affairs (A9-0200/2020),
1. Approves the Commission proposal;
2. Calls on the Council to notify Parliament if it intends to depart from the text approved by Parliament;
3. Asks the Council to consult Parliament again if it intends to substantially amend the text approved by Parliament;
4. Instructs its President to forward its position to the Council, the Commission and the national parliaments.
EXPLANATORY STATEMENT
As from 1 January 2021, the EU VAT legislation will no longer apply to the UK. However, on the basis of the Protocol on Ireland/Northern Ireland, which is part of the Withdrawal Agreement, Northern Ireland will remain under the EU VAT legislation regarding goods with a view to avoiding a hard border between Ireland and Northern Ireland. For services, on the other hand, Northern Ireland is, together with the rest of the UK, considered as outside the EU.
In order for the EU VAT system to function properly, it is essential that taxable persons carrying out in Northern Ireland supplies of goods or intra-Community acquisitions of goods are identified for VAT purposes according to the EU rules.
From that perspective, it is important that those taxable persons are identified in Northern Ireland via a separate EU VAT identification number, granted according to the EU rules and that is different from any UK VAT identification numbers. It is possible that this EU VAT identification number will have to be attributed in addition to the VAT identification number applied in the UK in case, for example, a business supplies both goods and services in Northern Ireland.
For businesses, in particular those involved in the trade in goods to and from Northern Ireland, it should be clear and easy to understand which rules apply, that is either those in force in the EU or those applicable in the UK. The EU VAT identification number plays an important role in the functioning of the EU VAT system, e.g. to justify the exemption for so-called ‘intra-Community supplies’ of goods, to determine the applicable VAT refund procedures or for other procedures.
Therefore, the Commission proposes that VAT identification numbers in Northern Ireland have the specific prefix “XI”.
Your rapporteur supports this proposal, does not consider amending it and proposes to adopt the EP opinion under simplified procedure (Rule 52) in order to allow a quick adoption of the proposal well on time before 1 January 2021.
PROCEDURE – COMMITTEE RESPONSIBLE
Title |
Amending Directive 2006/112/EC on the common system of value added tax as regards the identification of taxable persons in Northern Ireland |
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References |
COM(2020)0360 – C9-0279/2020 – 2020/0165(CNS) |
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Date of consulting Parliament |
28.8.2020 |
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Committee responsible Date announced in plenary |
ECON 14.9.2020 |
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Rapporteurs Date appointed |
Irene Tinagli 7.9.2020 |
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Simplified procedure - date of decision |
27.10.2020 |
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Discussed in committee |
27.10.2020 |
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Date adopted |
27.10.2020 |
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Date tabled |
29.10.2020 |
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