Netherlands Resumes VAT Penalties for E-Commerce from 2025
The Dutch government resumes VAT penalties applicable to EU VAT e-Commerce businesses, effective 1 January 2025.
The Dutch government has announced the resumption of payment default fines for entrepreneurs participating in the EU VAT e-Commerce scheme. Effective 1 January 2025, this policy marks the end of the temporary suspension introduced in 2023 to address implementation challenges when the VAT rules changed to taxation in the Member State of Consumption.
Introduced in 2021, the EU VAT e-Commerce scheme facilitates the harmonization of VAT collection for international and intra-Community distance sales in the EU. Entrepreneurs can report and remit VAT to the Member State where the end consumer resides either directly or through the One Stop Shop (OSS) regimes in their home country.
Check out our manual on VAT for e-commerce in the EU.
The Dutch Government explains in a letter the reasons for ending the temporary suspension of VAT penalties applicable to the e-commerce sector:
- Resolution of Start-Up Issues: Initial problems in the OSS process have largely been resolved, and defaults are now processed semi-automatically.
- Reduced Administrative Burden: Objections and additional assessments related to the fines have significantly decreased, with fewer expected in 2025 compared to previous years.
- Budgetary Considerations: The suspension of fines led to revenue losses. With the resolution of earlier challenges, the rationale for continuing the suspension no longer applies.
Entrepreneurs are urged to ensure compliance with VAT reporting obligations under the scheme. The Dutch Tax and Customs Administration has streamlined processes to minimize errors and provide clarity.
Businesses should act promptly to adapt their systems and processes before the reintroduction of penalties to avoid financial and administrative repercussions.
How Can Marosa Help E-Commerce Businesses?
Marosa's VAT compliance software, VATify, ensures data quality by performing automated data analysis on all your invoices, including those with complex VAT logic. This automated solution helps reduce manual errors and identifies potential risk areas in your data.