According to the new Platform Tax Transparency Act - DAC7 - online marketplaces such as Amazon, eBay, and Vinted will now have to report sales made on their platforms by end users to the tax office.
This is part of a new set of EU legislation to keep e-commerce fair and avoid possible abuse of privileged positions, monopolistic practices, or tax evasion. Private sellers will be reported when they make over 2,000 euros or have over 30 transactions per year.
Technically, the DAC7 was supposed to force online marketplaces to report European users' sales starting this January 1st. Yet, for many European countries, the deadline has been pushed to the end of Q1.
DAC7 directive will mean that operators of digital platforms such as Amazon, Airbnb, or eBay are obliged to apply due diligence rules and comply with specific registration and information provision obligations.
Thus:
- They will have to apply rules and procedures on sellers to obtain specific data to comply with the provision of information to the Tax Administration.
- The activities affected are the so-called "relevant activities", namely leasing and temporary assignment of real estate and means of transportation, personal services, and sale of goods.
- They will be obliged to register in the census.
- Likewise, they will have an obligation to provide information to the Tax Administration. Sellers that are public administrations and listed entities are excluded from this information.
- The information obtained will be exchanged with the seller's Member States of residence and, in the case of leasing or transfer of use of the real estate, with the Member State where the real estate is located.
- Due diligence procedures will be implemented to ensure the veracity of the above data, particularly those relating to the seller's residence.
- Joint inspections at the European level will be included, involving simultaneous controls and the mobility of tax officials between Member States.
- It is planned to include a penalty regime for these reporting obligations.
Among other main points.
Marketplaces that can prove that the information has been communicated by other operators - being them only a transition marketplace - or that are registered in non-European jurisdictions where international treaties or conventions apply (the information is sent to all Member States), are excluded from the DAC7.
Finally, the provisions relating to joint inspections will start to apply as of January 1, 2024.
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