Proposal for IOSS Expansion by 2028

The EU has taken a major step toward tightening VAT rules on distance sales of imported goods. On May 13, 2025, the Council of Finance Ministers (ECOFIN) reached a political agreement on Directive 2023/0158, which will reform how VAT is collected on distance sales of imported goods with a value under EUR 150. The new rules will take effect on July 1, 2028.

This new legislation will shift the responsibility for VAT from postal operators to sellers and platforms, especially those not using the Import One Stop Shop (IOSS).

Abolishing the Special Arrangements Model

Today, import VAT on low-value goods is often collected by postal and courier operators. This will be abolished. The EU is clearly shifting the VAT responsibility to the business selling the goods or the platform facilitating the sale.

New VAT Liabilities for Sellers and Platforms

If a business does not use IOSS, it will now be fully responsible for collecting and paying VAT in the EU country where the customer receives the goods. This applies to both transactions:

• Import VAT
• VAT on the distance sale to the consumer.

Businesses or platforms making intra-Community distance sales of goods and not registered under IOSS will now need to register for VAT in each EU country where their customers are located, often via a fiscal representative.

The Role of IOSS

Businesses that use the Import One Stop Shop (IOSS) can simplify VAT compliance significantly:

• They file a single VAT return in one Member State.
• That Member State of identification redistributes the VAT to others.
• Imports are VAT-exempt, as VAT is declared on the sale instead.

This change is designed to encourage businesses to adopt IOSS and ensure more consistent VAT collection across Member States.

Learn more about the Import One Stop Shop (IOSS).

The Commission will also introduce measures (under Article 143.1.a of Directive 2025/516/EU) to link each shipment with the correct IOSS number to fight VAT fraud.

How this Change Will Impact Businesses?

This reform is more than just a legal update – it will transform the VAT landscape for businesses importing goods into the EU:

• Sellers and platforms become the primary VAT payers – not carriers.
• Use of IOSS becomes even more critical.
• Non-compliant shipments may be delayed, and consumers might have to step in and pay VAT themselves – leading to possible frustration, delays, and disputes.

The EU is making a clear move toward greater VAT control and supplier accountability. Businesses have three years to prepare for these changes. But don’t wait – early planning and IOSS adoption can save you from compliance headaches, delivery delays, and unexpected costs down the line.

How can Marosa Help You?

If you’d like help evaluating your options or setting up IOSS, our VAT experts are here to support you.