NAVIGAL

Tax man goes after E-commerce

Banks will be obliged to provide the Polish tax office with the details of their clients’ E-commerce transactions.

The government set out to draft a new policy aimed at introducing such measures by the end of the year 2022. This is a result of an EU directive, which requires all member countries to tighten tax regulations in this fast growing sector of online sales.

When will the banks have to report transaction details? This mainly concerns payments made between EU member states. It’s enough for a business to make 25 or more payments to one entity per quarter. Later banks will be required to submit full documentation to the appropriate tax office. The new law is to be introduced next year, in Poland perhaps as early as 1 January. It’s the result of a new EU directive:

https://tiny.pl/whsd4, which requires that the new E-commerce tax is introduced in all EU countries by the end of next year. 

The objective is to eliminate tax irregularities, especially issues with enforcing VAT charges on online transactions. Those should be (in most cases) taxed in the country of the goods recipient. Meanwhile many businesses are trying to evade the regulations by paying VAT in the country offering a lower rate. This change in law is a game changer and may influence prices in online marketplaces.

The information collected about online transactions will be stored by designated administrative bodies for three years from the end of the tax year in which the transaction was made. In the case of Poland this will be the Head of the National Tax Administration in a standard xml form.

Experts predict that transactions made through large platforms such as Amazon or Allegro, as well as smaller online stores will become much more visible for tax offices across the EU.