On November 5, 2024, the ECOFIN Council took an important step toward the digitalization of VAT processes in Europe:
After months of negotiations and several failed attempts, an agreement was finally reached on a common approach to the "VAT in the Digital Age" (ViDA) initiative.
A small downside: The negotiated compromise must now be sent back to the EU Parliament for final deliberation.
As one of the largest networks for the secure, fast, and seamless exchange of electronic invoices and other digital documents in Europe, TRAFFIQX® welcomes this breakthrough – a milestone for the European tax landscape and a long-overdue impulse for the cross-border harmonization of value-added tax.
In an environment where companies are increasingly operating internationally and transparency requirements in accounting are rising, ViDA provides a unified foundation for electronic invoicing and digital reporting obligations.
The ViDA initiative addresses precisely these areas. Its goal is to promote digital document exchange across Europe, automate administrative processes, and increase the efficiency of tax collection. And, last but not least: significantly reduce tax fraud, particularly in VAT and input tax processes.
Specifically, ViDA means that companies within the EU will soon use uniform standards for electronic invoices – with the goal of making VAT information available in real-time and thereby ensuring greater tax transparency.
The roadmap for implementing the ViDA requirements has already been established:
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Starting in January, member states will be allowed to mandate e-invoicing without requiring the recipient's consent. This rule will also apply in Germany from January for all domestically received B2B invoices.
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By 2028, all companies in Europe are expected to use a unified VAT registration system. Additionally, the first (voluntary) measures for monitoring the platform economy are set to come into effect. Germany, with its current “e-Invoicing roadmap,” is on a good path – and even progressing at an exceptionally fast pace.
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From 2030, the mandatory digital reporting requirement for cross-border transactions within the EU will finally be introduced. Germany is expected to meet this deadline without any issues – and will likely even surpass it ahead of schedule.
- By January 2035, the harmonized digital tax environment in Europe is expected to be fully implemented.
Germany could (finally) become a pioneer again.
In Germany, significant progress has already been made in the area of eInvoicing:
Companies issuing invoices to public authorities are already required to submit them electronically using formats such as XRechnung.
Starting in 2025, the eInvoicing mandate will be extended to B2B transactions, requiring all companies in Germany to receive and process “true” electronic invoices. In the following years, additional mandatory stages will gradually come into effect, so that by early 2028, the entire German economy is expected to have fully transitioned to both receiving and sending true electronic invoices.
Not ready for eInvoicing yet? Our providers have the perfect solution for your electronic invoice inbound and outbound processing!
TRAFFIQX® supports companies as an experienced provider network to ensure a smooth implementation of these changes. Together with our partners and customers, we are driving the digital transformation of invoicing processes in Europe and guiding you into a connected, secure, and future-ready digital economy.
