July 2020
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On 18 February 2020, the European Council adopted a new set of rules that, as of 1 January 2024, will require payment service providers (PSPs) to record certain information on payment transactions and report this information to the tax authorities of EU Member States. In this article, the authors discuss the scope and implications of the new VAT obligations as laid down in Directive 2020/284/EU and Regulation 2020/283/EU. Although concurring with the need to introduce adequate VAT enforcement mechanisms, the authors identify several problem areas in which the new VAT record keeping and reporting obligations for PSPs might see an improvement.