VAT Changes in Place of Supply Rules

These changes will affect telecommunication, broadcasting and electronically supplied services provided to private consumers.

These rules essentially dictate that such services shall no longer fall to be subject to VAT in the jurisdiction where the supplier is established but shall shift to the jurisdiction where the customer is established, has his/her permanent address or usually resides.

Therefore, rather than being subject to one fixed VAT rate, such suppliers shall now be potentially exposed to VAT in 28 Member States and hence would particularly require to re-think their pricing strategies and margins and re-vamp IT and software to cater for multiple VAT rates.