EU VAT Management

Last fall, the European Commission unveiled a package of proposals detailing its plans for an all-encompassing reform of its value added tax (VAT) rules that have been in place for 25 years.

As global companies monitor this proposed overhaul, along with other sweeping regulatory shifts concerning corporate tax requirements, tax functions are busily assessing the current state of their VAT management processes and technology and how easily these resources can be adapted to satisfy new rules.

Input from tax professionals who attended a tax technology conference, TaxTech, held in London late last year, sheds sobering light on the current state of VAT management. The majority of conference attendees – indirect tax executives and managers – work for companies that operate in 40 or more countries. Here’s how those global tax leaders described their current VAT management capabilities:

  • 66 percent said their ERP systems are either “not well-configured for VAT” or are only “adequately configured for VAT;”
  • 40 percent said they did not have standardized VAT management processes within their EU operations;
  • 94 percent indicated they rely on spreadsheets as a primary supporting technology for VAT compliance; and
  • 63 percent described their current tax compliance risk as “medium” or “high.”

The EU’s likely VAT reform and other global regulatory changes concerning tax will compel companies to produce more tax data, more frequently. The survey results above suggest fulfilling this “more tax data, more frequently” mandate may be hindered by subpar processes and technology. One way to improve those areas is by treating VAT management as a cycle of three interlocking processes (tax determination, compliance and audit, and data management and analytics) – as this post describes.

Explore more Resources from our Industry Influencers:

Danny Vermeiren

Director of VAT

See All Resources by Danny

Danny Vermeiren is the former Director of VAT in the Chief Tax Office, where he was responsible for external positioning, VAT strategy and helping clients develop solutions to meet their needs. Danny has 20+ years of experience in VAT, both in consulting and in-house as a global director of indirect taxes for a large diversified manufacturing company. Danny is a certified lawyer with a postgraduate degree in tax law.

View Newsletter Signup

Explore Our Solutions

Discover how our technology solutions and software can help you streamline tax, stay compliant, and grow your business.

Browse All Solutions
Business using tax technology solutions