First signs of tightening EU tax compliance: what foundation sellers should build
Around 2019, several EU countries stepped up VAT supervision of cross-border e-commerce. There were many signals: platforms began being required to provide seller data, some countries increased scrutiny of under-declared shipments, and VAT number application and verification processes tightened.
Faced with such changes, sellers' common first reaction is to look for "coping tricks". But from our practice, tricks have an ever-shorter shelf life; what really matters is the foundation. That foundation is three things:
1. A VAT-number system in your own name
Including the VAT number and EORI number. Borrowed or attached numbers are a fatal flaw in any inspection. A tax number is a qualification, not a formality.
2. Traceable filing records
Import data and sales data must corroborate each other. Long-term output with no input, or excessive input-output gaps, are both things that attract attention.
3. Complete document archiving
Customs declarations, clearance documents, transport documents — these materials are usually kept for years. If you can't find them when needed, it is as good as having none.
If your European business is still growing, treat building your VAT numbers as a standalone task rather than patching it after problems appear. This is also why we later promoted "self-tax deferment" as our main line.
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