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 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 to replace the paper certificate with an electronic certificate on 8 July.

In view of the large number of IT projects currently facing them, Member States would be
allowed to continue to use the paper version of the exemption certificate for a transitional
period until 30 June 2030. The Commission will, by means of implementing acts, determine the technical details and specifications concerning the electronic certificate and its processing.

The proposal is 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.

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

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