In order to confirm that a supply of goods or services qualifies for an exemption under Article 151(1) of the VAT directive, the customer (i.e. the eligible body or individual to whom the exempt supply of goods or services is made) needs to file a 'VAT exemption certificate'. Such transactions mainly relate to transactions where the customers are for instance international organisations or institutions (embassies, consulates, ...). Annex II of Council Implementing Regulation 282/2011 lays down the format of the exemption certificate. At the moment, the certificate is designed in a paper format, requiring signature by the authorities of the 'host' country by hand.

In order to reduce the administrative burden and paper costs, the European Commission tabled a proposal in July 2024 to replace the paper certificate with an electronic certificate. The Commission will, by means of implementing acts, determine the technical details and specifications concerning the electronic certificate and its processing.

The proposal was subject to to the special legislative procedure, requiring unanimous support in Council, following consultation of the European Parliament and the European Economic and Social Committee.

In the European Parliament, the proposal was assigned to the Economic and Monetary Affairs Committee (Rapporteur: Aurore Lalucq, S&D, France). The European Parliament adopted an opinion, without amendments, in November 2024.

The Council formally adopted the proposal in February 2025, with new rules coming into force on 1 July 2031 to allow tax authorities sufficient time to develop the necessary IT systems.

The Council Directive was published in the Official Journal of the EU on 28 February 2025.

References:

• EP Legislative observatory, Procedure file on the proposal for a Council Directive on amending Directive 2006/112/EC as regards the electronic value added tax exemption certificate, 2014/0152 (CNS)
• European Commission, Proposal for a Council Directive amending Directive 2006/112/EC as regards the electronic value added tax exemption certificate, July 2024
• European Commission, Proposal for a Council Implementing Regulation amending Implementing Regulation (EU) No 282/2011 as regards the electronic value added tax exemption certificate, July 2024
• European Parliament, Report on the Proposal for a Council Directive amending Directive 2006/112/EC as regards the electronic value added tax exemption certificate, November 2024
• Council of the EU, Council introduces electronic VAT exemption certificate, December 2024
• Council of the EU, Taxation: Council adopts new electronic VAT exemption certificate to replace paper forms, February 2025
• Council of the EU, Council Directive amending Directive 2006/112/EC as regards the electronic value added tax exemption certificate, February 2025
• Official Journal of the EU, Council Directive amending Directive 2006/112/EC as regards the electronic value added tax exemption certificate, February 2025

Author: Pieter Baert, Members' Research Service, legislative-train@europarl.europa.eu