The EU (European Union)’s Valued-Added Tax (VAT) package on cross-border business-to-consumer (B2C) e-commerce activities will take place in July 1, as part of efforts to ensure a more level playing field for all businesses, to simplify cross-border e-commerce and to introduce greater transparency for EU shoppers when it comes to pricing and consumer choice.

These rules will have an immediate effect on all businesses in the supply chain such as individual sellers and marketplaces.

Any online sellers, including online marketplaces/platforms must apply for business registration in an EU member state if they want to sell products to the EU.

Their deals will be subject to VAT applicable in countries where buyers reside.

If the seller registers for Import One Stop Shop (IOSS) of each member state, consumers will know the final prices, inclusive of VAT. If unregistered, online buyers must pay VAT when goods are imported to the EU.

The existing thresholds for distance sales of goods within the EU will be abolished and replaced by a new EU-wide threshold of EUR 10,000.

According to the Vietnamese Ministry of Industry and Trade, online sellers that want to supply goods to the EU must seek a reliable partner in the EU to handle VAT declaration and payment procedures in line with regulations

Reporting by MINH LE – Translating by A.T