Decision (EU) 2019/310 authorising Poland to introduce a special measure derogating from Article 226 of Directive 2006/112/EC on the common system of value added tax

Summary:

Council Implementing Decision of 18 February 2019 authorising Poland to introduce the split payment mechanism for the payment of VAT for certain supplies of goods and services susceptible to fraud.

Further information:

In May 2018 Poland requested authorisation to derogate from Article 226 of Directive 2006/112/EC (the VAT Directive). Although Poland has taken numerous measures to fight fraud, it considers that those measures are still insufficient. Poland is of the view that the application of the split payment mechanism will eliminate VAT fraud.

Under the split payment model the amount of VAT deposited on a separate VAT account of a taxable person can be used for restricted purposes only, namely for the payment of the VAT liability to the tax authority or for the payment of VAT on invoices received from suppliers. Thus it is better guaranteed that the tax authorities will receive the whole VAT amount which should be transferred by the taxable person to the Polish State Treasury.

In view of the fact that the split payment mechanism for supplies of goods and services susceptible to fraud can bring effective results in the fight against tax fraud, in January 2019 the European Commission proposed that the derogation requested by Poland should be authorised from 1 March 2019 until 28 February 2022.

• Primary Source

EUR-Lex: COM(2019)10: Proposal for a Decision authorising Poland to introduce a special measure derogating from Article 226 of Directive 2006/112/EC on the common system of value added tax https://eur-lex.europa.eu/legal-content/EN/HIS/?uri=COM:2019:010:FIN

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