Proposal for a COUNCIL IMPLEMENTING DECISION amending Implementing Decision 2013/53/EU as regards authorisation to the Kingdom of Belgium to apply for a further period the special measure derogating from Article 285 of Directive 2006/112/EC
Date: 2021-11-23
Institutions: Directorate-General for Taxation and Customs Union, European Commission
Subjects: Belgium, VAT, derogation from EU law, small business, tax exemption

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   EUROPEAN COMMISSION  Brussels, 23.11.2021  COM(2021) 711 final 2021/0369 (NLE)  Proposal for a COUNCIL IMPLEMENTING DECISION amending Implementing Decision 2013/53/EU as regards authorisation to the Kingdom of Belgium to apply for a further period the special measure derogating from Article 285 of Directive 2006/112/EC  
 
EXPLANATORY MEMORANDUM 

Pursuant  to  Article  395(1)  of  Council  Directive  2006/112/EC  of  28  November  2006  on  the 
common system of valued added tax (‘the VAT Directive’), the Council, acting unanimously 
on  a  proposal  from  the  Commission,  may  authorise  any  Member  State  to  apply  special 
measures  for  derogation  from  the  provisions  of  that  Directive  in  order  to  simplify  the 
procedure for collecting VAT or to prevent certain forms of tax evasion or avoidance. 

By letter registered with the Commission on 5 May 2021, Belgium requested an authorisation 
to continue to apply, until 31 December 2024, a measure derogating from Article 285 of the 
VAT  Directive,  allowing  Belgium  to  exempt  from  VAT  taxable  persons  whose  annual 
turnover is no higher than EUR 25 000. 

In  accordance  with  Article  395(2),  second  subparagraph,  of  the  VAT  Directive,  the 
Commission  informed  the  other  Member  States  by  letter  dated  29  June  2021  of  the  request 
made by Belgium. The Commission notified Belgium by letter dated 30 June 2021 that it had 
all the information necessary to consider the request. 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

Chapter 1 of Title XII  of the VAT Directive allows for the possibility for Member States to 
apply  special  schemes  for  small  enterprises,  including  the  possibility  of  exempting  taxable 
persons below  a certain  annual  turnover. This  exemption  implies that a taxable person does 
not have to charge VAT on his supplies and, consequently, he or she cannot deduct the VAT 
on his inputs. 

Under Article 285 of the VAT Directive, Member States which did not make use of Article 14 
of Council Directive 67/228/EEC1, can exempt taxable persons whose threshold is no higher 
than EUR 5 000. As Belgium did not make use of this option, this resulted in the application 
of a particularly low threshold which in 2012 corresponded to EUR 5 580. 

At  the  request  of  Belgium,  by  Council  Implementing  Decision  2013/53/EU2  the  Council 
authorised Belgium to exempt from VAT taxable persons whose annual turnover is no higher 
than  EUR  25  000  until  31  December  2015.  This  decision  was  first  prolonged  until  31 
December  2018  by  Council  Implementing  Decision  (EU)  2015/23483,  and  then  until  31 
December 2021 by Council Implementing Decision (EU) 2018/20774. 

Belgium requested another extension of that measure for a limited period. Belgium indicated 
that  the  special  measure  reduces  administrative  burden  for  both  taxable  persons  and  the  tax 

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OJ 71, 14.4.1967, p. 1303/67. 
Council Implementing Decision 2013/53/EU of 22 January 2013 authorising the Kingdom of Belgium 
to introduce a special measure derogating from Article 285 of Directive 2006/112/EC on the common 
system of value added tax, OJ L 22, 25.1.2013, p. 13. 
Council  Implementing  Decision  (EU)  2015/2348  of  10  December  2015  amending  Implementing 
Decision 2013/53/EU authorising the Kingdom of Belgium to introduce a special  measure derogating 
from  Article  285  of  Directive  2006/112/EC  on  the  common  system  of  value  added  tax,  OJ  L  330, 
16.12.2015, p. 51. 
Council  Implementing  Decision  (EU)  2018/2077  of  20  December  2018  amending  Implementing 
Decision 2013/53/EU authorising the Kingdom of Belgium to introduce a special  measure derogating 
from  Article  285  of  Directive  2006/112/EC  on  the  common  system  of  value  added  tax,  OJ  L  331, 
28.12.2018, p. 222. 

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authority. It therefore contributes to the simplification of tax collection, as set out in Article 
395(1)  of  the  VAT  Directive.  The  measure  is  and  will  remain  fully  optional  for  taxable 
persons. 

According  to  Belgium,  at  the  end  of  2019  around  167  000  taxpayers,  being  16.5  %  of  all 
registered taxpayers, made use of the special measure. The impact of the special measure on 
VAT  revenues  remains  negligible,  as  it  does  not  significantly  affect  the  total  amount  of 
revenue  from  VAT  or  the  overall  amount  of  tax  revenue  collected  at  the  stage  of  final 
consumption. 

The  derogating  measure,  simplifying  the  obligations  of  small  operators,  is  in  line  with  the 
objectives set out by the European Union for small businesses. 

Given the positive impact on the reduction of administrative burden for businesses and the tax 
administration without a major impact on the total VAT revenue, it is appropriate to authorise 
Belgium to extend the derogation measure until 31 December 2024.  

• 

Consistency with existing policy provisions in the policy area 

The derogating measure is in line with the objectives of Directive (EU) 2020/285 amending 
Articles 281 to 294 of the VAT Directive on a special scheme for small enterprises5, which 
resulted from the VAT action plan6, and aims to create a modern, simplified scheme for those 
businesses.  In  particular,  it  seeks  to  reduce  VAT  compliance  costs  and  distortions  of 
competition  both  domestically  and  at  EU  level,  reduce  the  negative  impact  of  the  threshold 
effect, and facilitate business compliance as well as monitoring by tax administrations. 

Moreover, the threshold of EUR 25 000 is consistent with Directive (EU) 2020/285, insofar as 
it allows Member States to set the annual turnover threshold required for an exemption from 
VAT at a level no higher than EUR 85 000 (or the equivalent in national currency). 

Similar derogations, exempting from VAT taxable persons whose annual turnover is below a 
certain  threshold,  as  provided for in  Articles 285 and 287 of the VAT  Directive, have been 
granted  to  other  Member  States.  The  Netherlands7  has  been  granted  a  threshold  of  EUR 
25 000; Italy8 a threshold of EUR 30 000, Luxembourg9 a threshold of EUR 35 000; Poland10, 

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Council  Directive  (EU)  2020/285  of  18  February  2020  amending  Directive  2006/112/EC  on  the 
common system of value added tax as regards the special scheme for small enterprises and Regulation 
(EU)  No  904/2010  as  regards  the  administrative  cooperation  and  exchange  of  information  for  the 
purpose  of  monitoring  the  correct  application  of  the  special  scheme  for  small  enterprises  (OJ  L  62, 
2.3.2020, p. 13). 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council  and  the  European 
Economic and Social Committee on an action plan on VAT – Towards a single EU VAT area – Time to 
decide COM(2016)148 final. 
Council  Implementing  Decision  (EU)  2018/1904  of  4  December  2018  authorising  the  Netherlands  to 
introduce  a  special  measure  derogating  from  Article  285  of  Directive  2006/112/EC  on  the  common 
system of value added tax (OJ L 310, 6.12.2018, p. 25). 
Council  Implementing  Decision  (EU)  2016/1988  of  8  November  2016  amending  Implementing 
Decision  2013/678/EU  authorising  the  Italian  Republic  to  continue  to  apply  a  special  measure 
derogating from Article 285 of Directive 2006/112/EC on the common system of value added tax (OJ L 
306, 15.11.2016, p. 11). 
Council  Implementing  Decision  (EU)  2019/2210  of  19  December  2019  amending  Implementing 
Decision 2013/677/EU authorising Luxembourg to introduce a special measure derogating from Article 
285  of  Directive  2006/112/EC  on  the  common  system  of  value  added  tax  (OJ  L  332,  23.12.2019, 
p. 155). 

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Latvia11 and Estonia12 have been granted a threshold of EUR 40 000; Hungary13 a threshold of 
EUR 48 000; Lithuania14 a threshold of EUR 55 000; Croatia15 a threshold of EUR 45 000; 
Malta16 a threshold of EUR 30 000; Slovenia17 a threshold of EUR 50 000; and Romania18 a 
threshold of EUR 88 500. 

Derogations from the VAT Directive should always be limited in time so that their effects can 
be  assessed.  In  addition,  the  inclusion  of  an  expiry  date  of  the  special  measure  until  31 
December 2024, as requested by Belgium, is aligned with the requirements of Directive (EU) 
2020/285.  That  directive  provides  for  1  January  2025  as  the  date  on  which  Member  States 
will have to apply the national provisions, which they are required to adopt, to comply with it. 

The proposed measure is therefore consistent with the provisions of the VAT Directive. 

• 

Consistency with other Union policies 

The  Commission  has  been  consistently  stressing  the  need  for  simpler  rules  for  small 
enterprises.  In  this  respect,  the  Commission  adopted  in  March  2020  an  SME  Strategy  for  a 
sustainable and digital Europe19, where it committed to continue to work to reduce the burden 
on SMEs. The objective to reduce the regulatory burden for SMEs is one of the pillars of that 
strategy.  This  special  measure  is  in  line  with  such  objectives,  as  far  as  fiscal  rules  are 
concerned.  It  is  also  consistent  with  the  2020  Action  Plan  on  fair  and  simple  taxation 

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Council Implementing Decision (EU) 2018/1919 of 4 December 2018 amending Decision 2009/790/EC 
authorising  the  Republic  of  Poland  to  apply  a  measure  derogating  from  Article  287  of  Directive 
2006/112/EC on the common system of value added tax (OJ L 311, 7.12.2018, p. 32). 
Council  Implementing  Decision  (EU)  2020/1261  of  4  September  2020  amending  Implementing 
Decision  (EU)  2017/2408  authorising  the  Republic  of  Latvia  to  apply  a  special  measure  derogating 
from  Article  287  of  Directive  2006/112/EC  on  the  common  system  of  value  added  tax  (OJ  L  296, 
10.9.2020, p. 4). 
Council Implementing Decision (EU) 2021/358 of 22 February 2021 amending Implementing Decision 
(EU) 2017/563 authorising the Republic of Estonia to apply a special measure derogating from Article 
287 of Directive 2006/112/EC on the common system of value added tax (OJ L 69, 26.2.2021, p. 4). 
Council Implementing Decision (EU) 2018/1490 of 2 October 2018 authorising Hungary to introduce a 
special measure derogating from Article 287 of Directive 2006/112/EC on the common system of value 
added tax (OJ L 252, 8.10.2018, p. 38). 
Council  Implementing  Decision  (EU)  2021/86  of  22  January  2021  authorising  the  Republic  of 
Lithuania  to  apply  a  special  measure  derogating  from  Article  287  of  Directive  2006/112/EC  on  the 
common system of value added tax (OJ L 30, 28.1.2021, p. 2). 
Council  Implementing  Decision  (EU)  2020/1661  of  3  November  2020  amending  Implementing 
Decision (EU) 2017/1768 authorising the Republic of Croatia to introduce a special measure derogating 
from  Article  287  of  Directive  2006/112/EC  on  the  common  system  of  value  added  tax  (OJ  L  374, 
10.11.2020, p. 4). 
Council  Implementing  Decision  (EU)  2021/753  of  6  May  2021  authorising  Malta  to  apply  a  special 
measure derogating from Article 287 of Directive 2006/112/EC on the common system of value added 
tax, and repealing Implementing Decision (EU) 2018/279 (OJ L 163, 10.5.2021, p. 1). 
Council  Implementing  Decision  (EU)  2018/1700  of  6  November  2018  amending  Implementing 
Decision  2013/54/EU  authorising  the  Republic  of  Slovenia  to  introduce  a  special  measure  derogating 
from  Article  287  of  Directive  2006/112/EC  on  the  common  system  of  value  added  tax  (OJ  L  285, 
13.11.2018, p. 78). 
Council  Implementing  Decision  (EU)  2020/1260  of  4  September  2020  amending  Implementing 
Decision (EU) 2017/1855 authorising Romania to apply a special measure derogating from Article 287 
of Directive 2006/112/EC on the common system of value added tax (OJ L 296, 10.9.2020, p. 1). 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions  –  An  SME  Strategy  for  a 
sustainable and digital Europe (COM(2020) 103 final). 

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supporting  the  recovery  strategy20,  which  acknowledges  that  tax  compliance  costs  remain 
high in the EU, and that compliance costs are typically substantially higher for small than for 
large companies. 

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

Article 395 of the VAT Directive. 

• 

Subsidiarity (for non-exclusive competence)  

Considering the provision of the VAT Directive on which it is based, the proposal falls under 
the exclusive competence of the European Union. Hence, the subsidiarity principle does not 
apply. 

• 

Proportionality 

The Decision concerns an authorisation granted to a Member State upon its own request and 
does not constitute any obligation. 

Given  the  limited  scope  of  the  derogation,  the  special  measure  is  proportionate  to  the  aim 
pursued,  i.e.  to  simplify  the  tax  collection  for  small  taxable  persons  and  for  the  tax 
administration. 

• 

Choice of the instrument 

The instrument proposed is a Council Implementing Decision. 

Under Article 395 of the VAT Directive, a derogation from the common VAT rules is only 
possible upon authorisation by the Council, which is acting unanimously on a proposal from 
the  Commission.  A  Council  Implementing  Decision  is  the  most  suitable  instrument  since  it 
can be addressed to an individual Member State. 

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Stakeholder consultations 

No stakeholder consultation has been conducted. The present proposal is based on a request 
made by Belgium and concerns only this particular Member State. 

• 

Impact assessment 

The proposal for a Council Implementing Decision aims at continuing for another three years 
a  simplification  measure  which  removes  many  of  the  VAT  obligations  for  businesses 
operating  with  an  annual  turnover  no  higher  than  EUR  25  000  and  therefore  has  a  positive 
impact  on  the  reduction  of  administrative  burden  for  businesses  and  tax  administration 
without  a  major  impact  on  the  total  VAT  revenue.  Because  of  the  narrow  scope  of  the 
derogation and its limited application in time, the impact of the measure will in any case be 
limited. 

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Communication  from the  Commission to the  European Parliament and the  Council  –  An  Action Plan 
for fair and simple taxation supporting the Recovery Strategy (COM(2020) 312 final). 

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The derogating measure will be optional for taxable persons. Taxable persons will be able to 
opt  for  the  regular  VAT  arrangements  in  accordance  with  Article  290  of  Directive 
2006/112/EC. 

• 

Fundamental rights 

The proposal does not have any consequences for the protection of fundamental rights. 

4. 

BUDGETARY IMPLICATIONS 

Following  entering  into  force  of  Council  Regulation  (EU,  Euratom)  2021/769  of  30  April 
2021  amending  Regulation  (EEC,  Euratom)  No  1553/89  on  the  definitive  uniform 
arrangements for the collection of own resources accruing from value added tax21, there will 
be no compensation calculation carried out by Belgium as of VAT own resource statement for 
the financial year 2021 onwards. 

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Council  Regulation (EU, Euratom) 2021/769 of 30 April  2021 amending Regulation (EEC, Euratom) 
No 1553/89 on the definitive uniform arrangements for the collection of own resources accruing from 
value added tax (OJ L 165, 11.5.2021, p. 9). 

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2021/0369 (NLE) 

Proposal for a 

COUNCIL IMPLEMENTING DECISION 

amending Implementing Decision 2013/53/EU as regards authorisation to the Kingdom 
of Belgium to apply for a further period the special measure derogating from Article 285 
of Directive 2006/112/EC 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on the Functioning of the European Union,  

Having  regard  to  Council  Directive  2006/112/EC  of  28  November  2006  on  the  common 
system of value added tax1, and in particular Article 395(1) thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

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By  Council  Implementing  Decision  2013/53/EU2  the  Kingdom  of  Belgium  was 
authorised  to  introduce  a  special  measure  derogating  from  Article  285  of  Directive 
2006/112/EC  to  exempt  from  value  added  tax  (VAT)  taxable  persons  whose  annual 
turnover  is  no  higher  than  EUR  25  000  until  31  December  2015  (‘the  special 
measure’).  That  authorisation  was  extended  initially  by  Council  Implementing 
Decision  (EU)  2015/23483  until  31  December  2018  and  subsequently  by  Council 
Implementing Decision (EU) 2018/20774 until 31 December 2021. 

By  letter  of  5  May  2021,  Belgium  submitted  a  request  to  the  Commission  for  an 
authorisation  to  continue  to  apply  the  special  measure  until  31  December  2024,  the 
date  by  which  Member  States  are  to  transpose  Council  Directive  (EU)  2020/2855 
which lays down simpler VAT rules for small enterprises. That Directive also allows 
Member States to exempt taxable persons whose Member State annual turnover does 
not exceed a threshold of EUR 85 000. 

OJ L 347, 11.12.2006, p. 1. 
Council Implementing Decision 2013/53/EU of 22 January 2013 authorising the Kingdom of Belgium 
to introduce a special measure derogating from Article 285 of Directive 2006/112/EC on the common 
system of value added tax (OJ L 22, 25.1.2013, p. 13). 
Council  Implementing  Decision  (EU)  2015/2348  of  10  December  2015  amending  Implementing 
Decision 2013/53/EU authorising the  Kingdom of Belgium to introduce a  special  measure  derogating 
from  Article  285  of  Directive  2006/112/EC  on  the  common  system  of  value  added  tax  (OJ  L  330, 
16.12.2015, p. 51). 
Council  Implementing  Decision  (EU)  2018/2077  of  20  December  2018  amending  Implementing 
Decision 2013/53/EU authorising the Kingdom of Belgium to introduce a special  measure derogating 
from  Article  285  of  Directive  2006/112/EC  on  the  common  system  of  value  added  tax  (OJ  L  331, 
28.12.2018, p. 222). 
Council  Directive  (EU)  2020/285  of  18  February  2020  amending  Directive  2006/112/EC  on  the 
common system of value added tax as regards the special scheme for small enterprises and Regulation 
(EU)  No  904/2010  as  regards  the  administrative  cooperation  and  exchange  of  information  for  the 
purpose  of  monitoring  the  correct  application  of  the  special  scheme  for  small  enterprises  (OJ  L  62, 
2.3.2020, p. 13). 

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(3) 

(4) 

(5) 

(6) 

(7) 

(8) 

(9) 

Pursuant  to  Article  395(2),  second  subparagraph,  of  Directive  2006/112/EC,  the 
Commission transmitted the request made by Belgium to the other Member States, by 
letter  dated  29  June  2021.  By  letter  dated  30  June  2021,  the  Commission  notified 
Belgium that it had all the information necessary for the appraisal of the request. 

The  special  measure  is  in  line  with  Directive  (EU)  2020/285,  which  seeks  to  reduce 
VAT  compliance  costs  for  small  enterprises,  distortions  of  competition  at  both 
national  and  Union  level,  and  the  negative  impact  of  transition  from  exemption  to 
taxation  (the  threshold  effect).  It  also  seeks  to  facilitate  compliance  by  small 
enterprises as well as monitoring by tax authorities. The threshold of EUR 25 000 is 
consistent with Article 284 of Directive 2006/112/EC. 

The  special  measure  will  remain  optional  for  taxable  persons.  Taxable  persons  may 
still  opt  for  the  normal  VAT  arrangements  pursuant  to  Article  290  of  Directive 
2006/112/EC. 

According to information provided by Belgium, the special measure will only have a 
negligible effect on the overall amount of the tax revenue Belgium collects at the stage 
of final consumption. 
Following the entry into force of Council Regulation (EU, Euratom) 2021/7696, there 
will be no  compensation calculation  carried out  by  Belgium with  regard  to  the VAT 
own resource statement for the financial year 2021 onwards. 

Given the positive impact of the special measure in reducing the administrative burden 
and compliance costs for both small enterprises and tax authorities, and the lack of any 
major  impact  on  the  total  VAT  revenue  generated,  Belgium  should  be  authorised  to 
apply the special measure for a further period. 

The  authorisation  to  apply  the  special  measure  should  be  limited  in  time.  The  time 
limit  should  be  sufficient  to  allow  the  effectiveness  and  appropriateness  of  the 
threshold  to  be  evaluated.  Moreover,  pursuant  to  Article  3(1)  of  Directive  (EU) 
2020/285,  Member States are to  adopt  and publish, by 31 December 2024, the laws, 
regulations  and  administrative  provisions  necessary  to  comply  with  Article  1  of  that 
Directive, and apply those provisions from 1 January 2025. It is therefore appropriate 
to authorise Belgium to apply the special measure until 31 December 2024. 

(10) 

Implementing Decision 2013/53/EU should therefore be amended accordingly, 

HAS ADOPTED THIS DECISION:  

Article 2 of Implementing Decision 2013/53/EU is replaced by the following: 

Article 1 

This Decision shall apply from 1 January 2013 until 31 December 2024.’ 

‘Article 2 

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Council  Regulation (EU, Euratom) 2021/769 of 30 April  2021 amending Regulation (EEC, Euratom) 
No 1553/89 on the definitive uniform arrangements for the collection of own resources accruing from 
value added tax (OJ L 165, 11.5.2021, p. 9). 

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This Decision is addressed to the Kingdom of Belgium. 

Done at Brussels, 

Article 2 

For the Council 
The President 

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