Proposal to amend Decision 2013/676/EU authorising Romania to continue to apply a special measure derogating from Article 193 of Directive 2006/112/EC on the common system of value added tax

Summary:

Proposal presented on 28 June 2019 by the European Commission authorising Romania to continue to apply the reverse charge mechanism to supplies of wood products.

Further information:

In 2009 Romania requested a derogation in order to be authorised to apply the reverse charge mechanism to supplies of wood products. Under this procedure, the taxable person, to whom the supplies are made, becomes liable for the payment of the VAT. This request was approved by Decision 2010/583/EU until 31 December 2013 and subsequently extended by Decision 2013/676/EU until 31 December 2016 and by Decision (EU) 2016/1206 until 31 December 2019.

On 11 March 2019 Romania again asked for an extension of the derogation regarding the application of the reverse charge mechanism to supplies of wood products. On the basis of the report provided by Romania, designating the recipient as the person liable for the payment of VAT for supplies of the above-mentioned wood products had the effect of preventing tax evasion and avoidance in this sector which is characterised by a large number of small resellers and intermediaries which have proved difficult to control.

An extension for another limited period seems therefore justifiable as it would appear that the measure has had no negative impact on fraud at the retail level, in other sectors or in other Member States. Taking into consideration the unchanged legal and factual situation, the Commission therefore proposes to extend the derogating measure, allowing Romania to continue to apply the derogation until 31 December 2022.