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On the 4 April 2019, the Austrian Ministry of Finance submitted the draft Digital Tax Act 2020 for consultation. In addition to the introduction of a new digital tax on online advertising services, the Digital Tax Act 2020 will implement the EU E-Commerce Package into the Austrian Value-Added Tax Act:
Digitalization and the business models of “digital MNEs” present challenges for international taxation. At EU level, the proposed “Council Directive on the common system of a digital services tax on revenues resulting from the supply of certain digital services” has recently been rejected. On a global level, there are discussions on digital taxation within the G20/OECD with a view to developing digital PEs and a digital services tax. Nevertheless, some states have chosen not to wait for international solutions and have started to implement unilateral measures.
Austria plans to introduce a digital services tax in 2020:
The e-commerce package shall enter into force from 1 January 2021. The goal is to better ensure taxation in the destination state. At the same time, the simplifications for businesses (One-Stop-Shop), which avoids a VAT registration in every destination Member State, shall be extended.
From January 2020, an obligation to keep records will apply to businesses that enable supplies or other services using online platforms or marketplaces (so-called electronic interfaces), but which do not owe VAT themselves.
These records must be provided to the Austrian tax authorities electronically on request, in order to ensure that VAT has been correctly accounted for. The obligation will affect services in the context of the ‘sharing economy’ or distance sales within the EU. The records must contain specific pieces of information, to be stipulated in an implementing regulation (“Sorgfaltspflichten-Umsatzsteuerverordnung”). If the obligations are breached, the electronic interface will be held liable for the tax.
Furthermore, liability will also apply for suppliers in non-EU countries, whose supplies to non-taxable persons are nominally deemed to be made by the electronic interface in accordance with the legal fiction. The precondition for the liability is that the non-EU supplier cannot assume with due care that the electronic interface observes its tax obligations. In line with the Austrian Implementing Regulation, this will also apply to certain businesses that carry out import distance sales, distance sales within the EU, or provide other services to non-taxable persons.
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