Joint liability for electronic interfaces who are not considered as deemed suppliers

On 16 November 2023, a draft law was adopted containing various provisions on VAT. Among them a new mechanism of joint liability will be introduced in article 51bis, §3bis in the Belgian VAT code. This joint liability will apply to VAT due as from January 1, 2024.

The implementation of this joint liability for electronic interfaces is in line with the approach adopted by neighbouring countries like Germany, France, and the United Kingdom. The introduction of the joint liability for electronic interfaces should result in a more effective and efficient VAT collection. In this respect, the Belgian legislator aims at a policy that is both curative (collecting the VAT) and preventive (encourage and significantly enhance supplier compliance). 

Based on the new joint liability, electronic interfaces will be jointly liable with the supplier for the payment of the VAT due. In many cases, this was already the case because previous legislation enlarged a commissionaire fiction whereby the electronic interface was considered as a deemed supplier.

This most recent draft law enhances the responsibility of the electronic interfaces and provides their joint liability even when they are not deemed suppliers. However, in case for example the customer (and not the supplier) acts as the importer of records for VAT purposes, neither the commissionaire fiction nor the joint liability will be applicable. In this scenario, only the customer will be liable to pay the import VAT.

Furthermore, for proportionality’s sake, the joint liability can only be invoked when the VAT authorities demonstrate that the electronic interface is not acting in good faith or has committed an error or negligence.

The new joint liability regime provides two specific minimum due diligence obligations in this respect:

1. The electronic interface should verify that the VAT taxable supplier has a valid VAT identification number before facilitating the sales and at least once per calendar year.
2. When contacted by the VAT authorities, the electronic interface is expected to urge the supplier whose supplies are being facilitated to correctly comply with VAT declaration and payment obligations. After the third communication that the VAT authorities have serious suspicions against the supplier, the electronic interface is expected to exclude the supplier from using the electronic interface without further delay.

Following the OSS and IOSS regimes as from 1 July 2021 and the DAC7-obligations implemented per 1 January 2023, this is yet another new legislation increasing the administrative and compliance burden of electronic interfaces… to be continued!

Should you facilitate supplies of goods via an electronic interface, do not hesitate to contact us and discuss more in depth on the impact of the new rules for your business.

Authors: Benoît Pernet, Indirect Tax Partner & Sebastien Van Ooteghem, Tax Manager.