This might as well be an appropriate headline for a dog food commercial or a slogan for an animal shelter. In our case it is regarding an issue, that has a much bigger magnitude and concerns every EU citizen. After 2020, the year of change and surprises, closed us and forced us into the comfort of our own home, the EU closed the year by the final steps in the adoption of the next long-term budget. The multiannual financial framework for 2021-2027 of €1.074 trillion becomes available for all beneficiaries of EU funding. Just on time to deal with the global health crisis and repair what seems irreparable.
To tighten the grip on the situation, the temporary recovery instrument, NextGenerationEU, will be the start of Europe’s healing process. Altogether, the package of a total € 1.8 trillion will be the largest ever financed through the EU budget by far.
“People only accept change when they are faced with necessity, and only recognize necessity when a crisis is upon them”
– Jean Monnet
In order to finance the NextGenerationEU, the European Commission will borrow the mind-blowing amount of €750 billion on the markets. The action would happen on behalf of the EU, as the Commission will use the “headroom”. This is the difference between the Own Resources ceiling of the budget and the actual amount spent. Member States must ratify the decision, while urged to act quickly and remain committed to the cause. The EU initially scheduled changes to the VAT treatment of goods and services for January as well, but, as a surprise to no one, postponed them for July.
Which is going to be the main source of revenue to the EU budget?
The EU integration has been an intense and controversial process, accepting change as a leading factor, but the revenue sources have not been changed over the last years, only receiving modifications.
The upcoming changes, regarding the taxation framework across the EU, will guarantee, that taxation of consumption for goods and services is available to the client or the respective residence of the beneficiary. They will also aim at extending the use of the “one-stop-source” (OSS) system for the payment of the VAT and force obligations on online platforms.
Every innovation requires attention to the details. Adopting new behavior and getting used to requirements may often be time-consuming, but on the market nobody has the opportunity to wait. Service providers may need to register in other EU Member States. Their activity will be taxable not only in the country of establishment, but also where:
One-stop source or a one-stop shop (store) is a business, which offers multiple services or products. This specific location can fulfill all the needs the client has.
Even though Europeans seem like a big, happy family, dealing with all these changes after the roller coaster of a year, that 2020 was, might be a lot to handle. Starting a new business in or in relation to Bulgaria hides a lot of legal and bureaucratic difficulties. This is why a key solution is reaching out for help from the people with the proper set of skills. Euroformat.eu is part of VD&A – an international law firm, which enjoys great authority both in Bulgaria and abroad. VD&A experts solve problems quickly, without unnecessary costs, saving their clients’ time and money. You can find them here: https://www.euroformat.eu/contact