EN    EN EN 
 
EN    EN  COMMISSION OF THE E UROPEAN COMMUNITIES 
Brussels, 11.11.2008 
SEC(2008) 2759 
Commission staff working document 
Annex to the Sixth report under Article 12 of  Regulation (EEC, Euratom) n° 1553/89 on 
VAT collection and control procedures 
{COM(2008) 719 final} 
 
EN 2   EN Commission staff working document 
Annex to the Sixth report under Article 12 of Regulation (EEC, Euratom) n° 1553/89 on VAT collection and control procedures 
Summary of State of Implementation of Report Recommendations 
RECOMMENDATION RESPONSE/RESULTS STATE OF IMPLEMENTATION 
1. Tax authorities assess the impact on 
voluntary compliance  of the various 
elements of tax policy (e.g. communication with taxpayers, administrative obligations of taxpayers, controls  20 Member States mentioned specific initiatives 
while 10 provided general assurance that any initiatives they took were evaluated – only one Member State provided any specific quantitative information.  Member States act to improve voluntary compliance 
but little evidence that their activity is evaluated (the nub of the recommendation).  
2. Member States that do not yet have a VAT control plan should develop such a 
plan Altogether 24 Member States responded but few 
alluded to any changes made since 2003. 6 replied that they had no specific VAT control plan, with 
only 5 stating they had. Th e remainder claimed that 
the elements comprising a VAT control plan was integrated in their overa ll tax control plans. Although the action recommended is clear and 
unambiguous Member State responses do not permit meaningful evaluation as to whether any change has been secured as a resu lt of the recommendation. 
3. Member States should increase the 
quality of the information on taxpayers 
and economic sectors  for a better 
targeting of controls  16 Member States claimed there had been 
improvements in the quality of information they had. Often linked to IT making new sources available or allowing the better manipul ation and distribution of 
existing data. Some specified the VAT Information Exchange System (VIES). The response to our questi on suggests that Member 
States are, in the main, improving their information 
sources.  
 
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4. The Commission believes that the 
control programme should be improved 
by means of feedback on the 
implementation  of the control plan that 
also takes qualitative criteria into account and not only the more commonly used quantitative criteria.  8 Member States made no or only very partial 
replies. 16 provided only a general description of 
their system (with 2 alludi ng to changes made since 
2003 and a further 2 referring  to current preparatory 
work). The remaining 3 provided some assurance, 1 referring to changes since 2003.  This modest recommendation aimed to ensure 
Member States were evalua ting the success of their 
control efforts and theref ore could make changes 
and adaptations where necessary. Can conclude from their responses that the majority of Member 
States can do so.  
5. Increase the awareness at central level 
of the criteria used by the regions  when 
selecting firms for control  9 Member States were not taking this action or did 
not reply. The remainder provided assurance that the central level was aware. Only 3 Member States 
alluded to particular changes since 2003.  Again we only have evidence that a very small 
number of Member States have pursued increased awareness since the recommendation was made but have some assurance that the majority consider their arrangements adequate. 
6. Those Member States that have still not equipped their auditors with the 
necessary IT tools  and that do not have a 
specialised IT audit function  are 
recommended to pursue this objective.  All Member States reported some procurement and 
distribution activity. There is no evidence that any 
Member States lack specialist IT audit but 5 reported a lack of audit software although using IT tools for the administrative tasks surrounding audits. As to evaluating success 17 made no reply, 4 gave a general assurance and only 6 replied with any vestige of supplementary information. Member States are extending their use of IT tools in 
VAT-audit work.  
7. Electronic archiving of the control process should be adopted unconditionally by the Member States.  With 3 exceptions all Member States responded that 
electronic archiving was now in use. Only 4 commented on evaluation activity. A further 4 mentioned obtaining management information. At first sight response has been good but it is clear 
that many Member States had already started this process before the Commission recommendation. There is little evidence that they are evaluating their activity – a key componen t of the recommendation.  
 
EN 4   EN 8. The structured recording of conducted 
controls and control results as a 
contribution to risk analysis  should be 
improved (number of visits, additional tax assessments, tax collected due to controls, etc.). Scrutiny of the replies received suggested there were 
9 Member States which had not yet achieved systems where the results of controls were fed back into the risk analysis process, or where there was doubt that they had done so. In evaluating Member State replies we merely 
looked for assurance that there was a way for results data to influence future risk analysis - a minimum requirement for a risk anal ysis system. We conclude 
that it is likely that 2/3rds of Member States have achieved this.  
9. Member States that do not evaluate 
the performance of individual control 
officials  should introduce such 
evaluation.  Only 1 Member State said that they still did not 
while 3 made no reply. 12 Member States described 
their standard personnel ev aluation procedures. Only 
1 Member State reported a special quality measuring exercise. It was also the onl y State to have evaluated 
its activity.  This is another instance where the factual outcome 
underlying the recommendation is in place in nearly 
all Member States. But there is no evidence that the complementary activity require d - that of evaluating 
success is in place, other than in 1 Member State.  
10 To monitor recovery and enforcement 
more effectively , Member States should 
develop performance indicators to assess their procedures so that they can be improved where necessary.   6 Member States did not specifically address the 
question while 1 appeared  to have no such 
indicators. 4 Member Stat es gave a very general 
description of their system s (in 1 the inference that 
their system pre-dated the recommendation was clear) while another 9 provided more specific 
information (3 of which did allude to changes since 2003). The remainder (7) provided general statements of assurance (3 making it clear that their systems were of long-standing). Although we can draw some assurance from the 
result that only 1 Member State seems to have no indicators – only 3 appear to have introduced them 
since the Commission published its recommendation whereas 4 were apparently using such indicators in 
advance of the recommendation. 
11. Improve the quality of information 
on collected and outstanding debts, 
penalties, and interest  and Member 
States should work to improve the quality of this information and its use in the evaluation of administrative processes.  Only 1 Member State said it was doing nothing 
although 4 made no reply or no relevant reply. 2 reported preparatory action while 13 gave general 
assurance of activity and 7 provided descriptive 
information. Including thos e doing preparatory work 
altogether 9 described sp ecific activity since 2003.  About one third of Member States have taken or are 
about to take such action since the recommendation 
was made while a quarter have done nothing or have 
made no report of activity. 
 
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