Regulatory updates - European Union

The adoption of the Commission Implementing Regulation (EU) 2026/1869 introduces further measures aimed at simplifying VAT administrative processes, including the following:

• Introduction of the Transfer of Own Goods (TOOG) scheme to the One Stop Shop (OSS): Businesses will be able to report qualifying cross-border transfers of their own goods through a single Member State of Identification, reducing the need to register in every destination member state in case of cross-border movements of own stock.
• Mandatory pre-filling of registration data: Information already available to the tax authority will be pre-filled when businesses register for a special scheme. Businesses will, however, remain responsible for reviewing and confirming the accuracy of the submitted data.
• Revisions to VAT filing procedures: Businesses will be able to save VAT return information before submission. The regulation also clarifies when nil VAT returns must be submitted and introduces other adjustments to the filing procedures for special schemes.

How does this relate to the overall aim of Pillar III?

The aim of Pillar III, Single VAT Registration (SVR), is to reduce the need for businesses to register and file for VAT in multiple Member States. Under ViDA, the scope of transactions covered by the One Stop Shop will be expanded, alongside a broader mandatory application of the reverse charge mechanism for certain supplies made by non-established, non-VAT registered suppliers, as well as further simplification and harmonization of VAT procedures.

The new TOOG scheme further expands the One Stop-Shop framework by adding a fourth special VAT scheme alongside the three existing schemes (Non-Union OSS, the Union OSS and the Import One Stop Shop (IOSS)). Similar to the existing schemes, the TOOG scheme provides a simplified mechanism for fulfilling VAT obligations across multiple Member States, in this case for qualifying cross-border transfers of own goods.  

Timelines

• January 1, 2027: Minor legislative and administrative changes affecting the One-Stop-Shop (OSS) and IOSS schemes will apply.
• July 1, 2028: The new Transfer of Own Goods scheme and mandatory reverse charge for certain supplies made by non-established and non-VAT-identified persons under the Single VAT Registration reforms will apply.

The Council has reached a provisional agreement on new measures to strengthen the fight against VAT fraud across the EU. The framework aims to improve cooperation between member states and EU bodies, including the European Public Prosecutor’s Office (EPPO) and the European Anti‑Fraud Office (OLAF), by granting them more direct access to key VAT data.

Under the new rules, EPPO and OLAF will be able to access information on cross‑border business transactions, including data held by Eurofisc, the EU’s anti‑VAT fraud network. This will allow investigative bodies to obtain first‑hand information more quickly, accelerating investigations and improving coordination between authorities.

The measures specifically target cross‑border VAT fraud, including missing trader intra‑community fraud (carousel fraud), which continues to cause significant revenue losses across the EU. The enhanced access to data is expected to strengthen detection capabilities and support faster enforcement actions.

Impact

The improved cooperation framework is designed to reduce VAT fraud losses, estimated at billions of euros annually, while ensuring a more level playing field for compliant businesses. By increasing transparency and enabling quicker investigations, the rules aim to enhance the overall effectiveness of VAT enforcement across the Union.

Next steps

The new rules are part of an amendment to Council Regulation 904/2010 on administrative cooperation and combating VAT fraud. Following the expected opinion of the European Parliament, the Council will proceed with formal adoption. The regulation will enter into force twenty days after publication in the Official Journal of the European Union.

The EU Commission’s announcement of the availability of the 2026 Work Programme for VAT in the Digital Age (ViDA) builds on the implementation strategy released in September 2025. The intent is to support the rollout of the ViDA package under the current Multiannual Financial Framework.

Aimed at modernizing the EU's value-added tax (VAT) system, reducing VAT fraud, and addressing challenges posed by the platform economy, the reforms will occur in stages beginning January 2027, addressing OSS (One Stop Shop) matters, and in 2028, addressing platform economy measures, through July 2030, when e-invoicing and DRRs become obligatory. The final milestone is 2035, when Member States with existing domestic digital reporting requirements must align with the ViDA’s intra-community framework.

To manage implementation risks, including IT readiness, fragmented implementation, and more, by Member States that introduce additional obligations beyond EU standards, the Commission has outlined a range of support mechanisms, including detailed explanatory notes, the technical support instrument (TSI), the fiscalis programme, and, where necessary, penalty procedures against Member States that fail to transpose the Directive on time.

For further information on the work programme, please visit the European Commission’s dedicated page.