CJEU – Recent Developments in Value Added Tax 2020

S. 21. The hot topic of joint and several liability (JSL) rules

Based on the optional rule in Art. 205 of the VAT Directive, Member States have, already for many years, implemented joint and several liability rules – often also labelled as “third-party liability” – for diverse scenarios in their national VAT law. About twenty Member States have made use of the option (in particular for cross-border supplies). These rules – although being practically challenging – have not led to many infringement proceedings or preliminary rulings before the CJEU (see, on the CJEU judgments, section 3.).

Recently, in the light of the digital revolution and the emergence of the “platform economy”, the relevance of JSL rules has gained momentum; how to apply VAT to the platform economy and the role of platforms in the VAT compliance and collection process are currently on the agenda of the OECD, the EU, and individual jurisdictions worldwide. In 2019, the OECD published a report (hereinafter “the OECD Report”) on the role of digital platforms in the collection of VAT/GST on online sales. This Report discusses different levels of integration of online platforms in the compliance and collection process in VA...