18 Mar

Coronavirus Update 17th March – Emergency VAT Measures

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Here is a summary of some emergency VAT measures to combat the financial impact of this pandemic, current as at 17 March 2020:

ITALY

  • The Italian Ministry of Finance announced on Friday, 13 of March that all the VAT payments due by March 16, 2020 will be postponed. Now it looks like the VAT payments for small businesses (with annual turnover below EUR 2m) will be postponed until 31st of May 2020 whereas for the remaining taxpayers the payments will be deferred until the 20th of March 2020. Moreover, all VAT declarations filings are to be postponed until the 30th of June 2020, including the Annual VAT Return for 2019 period. Businesses can apply for a 5-month payment plan.

SPAIN

GERMANY

  • The German tax authorities are offering a possibility to apply for delayed VAT payments as of the 13th of March 2020.

AUSTRIA

  • Application can be made to the tax authorities to postpone payment of VAT or payment via instalments. Application can also be made for reduction/waiver of late payment interest.

FRANCE 

  • Businesses can apply for a suspension of their tax payments due in March 2020.

UK

IRELAND 

POLAND

  • On the 11th of March 2020 the Polish Ministry of Finance informed that entrepreneurs who, due to the coronavirus, will have problems paying their taxes in a timely manner can apply for a reduction/relief or waiver/remission of arrears. Further detailed support should be announced by the Ministry of Finance in due course. In addition, the go-live date for the implementation of the combined SAF-T file with the VAT returns for large companies (the details of which Essentia provided to its readers in our February 2020 VAT Life publication) will be postponed from the 1st of April 2020 onto the 1st of July 2020. Moreover, the tax authorities are also to make the VAT refunds quicker. For full details about the proposed ‘shield package for companies’ follow this link: https://www.gov.pl/web/koronawirus/pakiet-oslonowy-dla-firm-w-zwiazku-z-koronawirusem

SWEDEN

  • The government is proposing an opportunity for temporary deferral with payment of VAT which is proposed to enter into force on April 7. The deferral period may be set for a maximum of one year.

NETHERLANDS

  • The government has announced that the Dutch tax authorities will grant a deferral of payment for any VAT if a company will motivate in writing that it has run into financial issues due to the coronavirus. As soon as the tax authorities receive such a request, they will put the collection of tax on hold.

CYPRUS

  • Cypriot government announced a temporary reduction of the standard VAT rate from 19% to 17% for 2 months and bringing down the reduced rate of 9% (applicable mainly to hotel accommodation, restaurant and catering services or domestic passenger transport) to 7.5% for 3.5 months.

JAPAN

  • Japan is considering temporarily lowering its Consumption tax rate from 10% to 5% on top of delaying the filing and payment deadlines by 1 month until April 2020.

CHINA

  • The country where the first cases of the coronavirus epidemic were detected has put some extensive measures in place to overcome the crisis, e.g. expanding temporarily the scope of the VAT exemption for goods and services needed to combat the effects of the virus, exempting temporarily from VAT all small-scale VAT payers located in Hubei Province or extending monthly VAT returns filing deadline for February and March 2020 periods by 2 weeks and 1 week, respectively.

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