EU and US strike 15% tariff deal
On Sunday 27 July, the EU and the US reached a framework trade agreement that sets a 15% import tariff on most EU goods — half the originally threatened rate — thereby avoiding a deeper trade conflict. The arrangement closely parallels the US-Japan deal announced on 23 July. The 15% tariff will apply to a broad range of sectors, including automobiles, semiconductors and pharmaceuticals. The two parties also agreed to eliminate tariffs on several strategic products. These include all aircraft and their components, selected chemicals, certain generic medicines, semiconductor manufacturing equipment, some agricultural goods, natural resources, and critical raw materials. Steel and aluminium were excluded and will instead be regulated under a quota system. In return, the EU has committed to substantially increasing its imports of US energy and military equipment. “With this deal, we are creating more predictability for our businesses. In these turbulent times, this is necessary for our companies to be able to plan and invest. We are ensuring immediate tariff relief. This will have a clear impact on the bottom lines of our companies. And with this deal, we are securing access to our largest export market. At the same time, we will give better access for American products in our market. This will benefit European consumers and make our businesses more competitive”, European Commission President Ursula von der Leyen said in a statement.
New EU own resources proposals meet resistance
EU Affairs Ministers met in Brussels on Friday 18 July to discuss the European Commission’s recently proposed new EU own resources package. The new Corporate Resource for Europe (CORE) levying progressive contributions from large companies with a net annual turnover of at least 100 million € sparked most of the criticism. While the European Commission says the new package could raise 58.5 billion € annually, many Member States pushed back, questioning the legality and economic impact of CORE. Germany firmly rejected it, calling it dead on arrival, warning it could harm competitiveness and trigger business relocations. Malta, Cyprus, and Italy echoed concerns, while others like Greece, Ireland, Finland, and Sweden emphasized caution and a preference for GNI-based contributions. Some countries, including Lithuania and Estonia, questioned the need for new resources if the budget size remains unchanged. Poland and Belgium raised specific objections to ETS revenue use and customs collection adjustments while other countries, such as France, supported expanding non-tax burdens like the CBAM instead. The debate can be watched again online here.
European Commission opens public consultation on VAT Rules for travel and tourism sectors
The European Commission launched on Thursday 24 July a public consultation aimed at gathering feedback from VAT experts and tax advisers on the modernisation of VAT rules applicable to the travel and tourism sectors. The consultation focuses on two main areas. Firstly, the special VAT scheme for travel agents, under which travel agents are taxed based on their margin and place of establishment. The Commission notes that the application of this scheme varies significantly across Member States, and that non-EU operators often benefit from competitive advantages, leading to unfair competition. The Commission is therefore considering reform options to clarify the scheme's scope and create a level playing field between EU and non-EU travel agents. Secondly, the consultation targets existing VAT rules for passenger transport, which determine taxation according to the distance travelled within the EU. According to the Commission, they are difficult to apply in practice, can place a significant administrative burden on smaller operators and lead to imbalances between different modes of transport. The Commission is consequently assessing options to simplify the rules regarding the place of taxation, including taxing the service at the place of departure or destination of the passenger and clarifying or revising the scope of the exemption under Article 148 of the VAT Directive for international air and sea transport. The public consultation, running until 16 October 2025, takes the form of an online questionnaire and an open feedback form. The input collected will contribute to shaping a potential legislative proposal, expected by the end of 2026.
Council formally adopts the VAT Directive on imported goods
The Council of the EU formally approved on Friday 18 July the Directive on VAT rules for distance sales of imported goods and import VAT, agreed by Member States earlier in May. Under the agreed rules, foreign suppliers and platforms will be made liable for import VAT and VAT on the distance sales of imported goods in the Member State of the final destination. This will encourage the use of the IOSS, as foreign traders or platforms that do not use it will need to register in every Member State where they sell goods. According to the Commission, platforms that don’t use the IOSS may face delays in customs processing, with packages held for extended periods. To further safeguard VAT revenues, non-EU suppliers who do not use the IOSS will be required to appoint a tax representative in the EU, unless they are based in a country with a mutual assistance agreement under Commission Implementing Decision (EU) 2021/942. This representative would be responsible for ensuring full VAT compliance. The rules will apply from 1 July 2028.
European Commission reports continued registration growth following new VAT rules for e-commerce
New figures from Member States show that more than 33 billion € in VAT revenues were collected in 2024 via the EU’s e-commerce VAT systems. Through a single registration in one Member State, the One Stop Shop (OSS) and Import One Stop Shop (IOSS) allow businesses to declare and remit VAT for cross-border sales of goods and services within the EU, as well as for imports of low-value goods. In 2024, over 24 billion € was declared via the Union OSS, 2.8 billion € via the non-Union OSS and 6.3 € billion through the Import OSS, representing a 26% increase compared to 2023. Since the reforms were introduced in mid-2021, Member States have collected nearly 88 billion € in VAT under the OSS and IOSS schemes. At the same time, the number of registered traders continues to grow steadily. By the end of 2024, over 170 000 businesses had signed up to the OSS and IOSS frameworks, with a notable increase of more than 20 000 new registrations in the Union OSS alone over the past year. The full report is available here.
European Commission announces 2025 eInvoicing country factsheets
The European Commission recently announced the release of its 2025 eInvoicing Country Factsheets. These factsheets provide comprehensive information on eInvoicing policies and practices in each EU Member State. They cover essential topics such as policy frameworks, VAT reporting and monitoring mechanisms that track eInvoicing adoption. The 2025 update introduces a fully redesigned structure, making the information easier to access. Key improvements include: - a concise summary section for quick insights; - a clear next steps section outlining future developments; - information on B2B and B2C eInvoicing mandates, in addition to B2G; and – information on potential use of eInvoicing in VAT real-time reporting systems.
FISC MEPs conclude their mission in Dublin
A delegation of the Subcommittee on Tax Matters (FISC) of the European Parliament, composed of FISC Chair MEP Pasquale Tridico (The Left, Italy), MEP Regina Doherty (EPP, Ireland), MEP Pierre Pimpie (PfE, France) and Billy Kelleher (Renew Europe, Ireland), spent Tuesday 22 July in Dublin. The delegation met with Members of the Finance Committee and the Committee for Budgetary Oversight of the Oireachtas, and with representatives of businesses, including Google, the Meta group and the Apple group, and of tax authorities, non-governmental organisations and academia. Following the visit, FISC Chair Pasquale Tridico welcomed a “fruitful exchange” and further declared: “I believe that Ireland should consider introducing a 15% tax rate for all companies, not only big multinationals. This would simplify the Irish tax system. It would also help Ireland to diversify its revenue sources and not rely only on tax revenue from a small number of big companies”. “Another way to diversify revenue would be to introduce an EU digital service tax, should the US not agree to go forward with the OECD agreement”, he added.
ETAF team wishes you a very nice summer break! The next edition of our Weekly Tax News will be dated Monday 1 September 2025.
