ViDA Platform Rules for the Travel Sector

ViDA Platform Rules for the Travel Sector

The VAT in the Digital Age (ViDA) package, formally adopted by the EU Council on March 11, 2025, introduces transformative "deemed supplier" rules specifically targeting digital platforms in the platform economy. These rules aim to close VAT compliance gaps in the sharing and gig economy by shifting responsibility from individual providers (e.g., small hosts or drivers) to the platforms themselves, ensuring fairer taxation and reducing administrative burdens on micro-businesses.

For the travel sector, and so particularly intermediaries facilitating short-term accommodation rentals and passenger transport, this means platforms like Airbnb, Booking.com, Uber, or BlaBlaCar will increasingly act as the VAT-liable entity. Below is a detailed breakdown, focusing on scope, mechanics, timelines, and travel-specific implications.

1. Core Mechanics: The Deemed Supplier Regime

• Definition and Application: Under the new rules (amending Article 9a of the VAT Directive 2006/112/EC), electronic interfaces (platforms) that facilitate relevant supplies are "deemed" to be the supplier for VAT purposes. This creates a fiction where:

  • The platform is treated as purchasing the service from the underlying provider (e.g., a hotelier or driver) at a deemed zero-rated price (no VAT charged to the platform).

  • The platform then "resells" the service to the end customer, collecting and remitting VAT at the rate of the Member State where the service is consumed (place of supply rules apply).

• Facilitation Threshold: The rules apply only if the platform "facilitates" the supply, defined as actively enabling payments, listings, or matching (e.g., processing bookings or fares). Pure information portals (e.g., review sites) are exempt.

• VAT Treatment: Platforms must charge VAT on the full facilitation fee plus the underlying service value (minus any non-VAT elements like insurance). Input VAT recovery is allowed on platform costs, but underlying providers lose direct recovery rights on supplies to the platform.

• Reporting: Integrated with ViDA's Domestic Reporting Requirements (DRR), platforms will submit real-time transaction data quarterly via a single EU portal, starting from 2030.

2. Scope: Relevance to Travel and Accommodation

• Covered Services:

  • Short-Term Accommodation Rentals: Applies to rentals of accommodation for less than 30 continuous days (e.g., vacation homes, hotel rooms via apps). This captures platforms like Airbnb or VRBO, where hosts supply lodging.

  • Passenger Transport: Includes road passenger transport (e.g., ride-sharing via Uber or taxis booked through apps) and potentially short-sea or inland waterway passenger services if facilitated digitally. Air and rail are generally excluded as they fall under other regimes.

• Travel Sector Implications: For tour operators and intermediaries, this interacts with the Tour Operators Margin Scheme (TOMS) under Articles 306–310 of the VAT Directive, and the deemed supplier rules do not apply to TOMS supplies, preserving margin-based taxation for packaged travel. However, platforms bundling transport/accommodation outside TOMS (e.g., standalone bookings) must comply. This levels the playing field but requires travel platforms to segregate TOMS vs. non-TOMS facilitation in their systems. Small EU providers benefit from simplified compliance, but non-EU platforms (e.g., US-based) may need EU VAT registrations.

3. Implementation Timelines

• Entry into Force: The ViDA package entered into force on April 1, 2025 (20 days after publication in the Official Journal).

• Voluntary Phase: Platforms can opt-in early from July 1, 2028, to gain familiarity and potentially qualify for transitional relief (e.g., simplified audits).

• Mandatory Compliance: Full application from January 1, 2030, for all relevant platforms. Non-compliance penalties can reach up to 15% of undeclared VAT, enforced by Member States.

• Broader Rollout: Linked to ViDA's phased reforms, including e-invoicing (mandatory by 2030) and DRR (from 2030), with full digital ecosystem integration by January 1, 2035.

• Transitional Measures: A two-year grace period (2028–2030) allows testing; platforms must notify tax authorities of opt-in status.

4. Key Challenges and Preparation Tips for Travel Businesses

• Compliance Burdens: Platforms face increased due diligence (e.g., verifying underlying providers' VAT status) and IT upgrades for real-time VAT calculation across 27 Member States' rates (e.g., 21% in Spain, 20% in France).

• Opportunities: Reduces fraud in the gig economy; travel platforms can market "VAT-inclusive" pricing to boost consumer trust.

• Risks: Misclassification of facilitation could trigger audits; interaction with OSS/IOSS for cross-border sales adds complexity.

• Action Steps: Audit your platform's facilitation model now; integrate VAT engines (e.g., Avalara or Vertex) by mid-2027; monitor EC guidelines for TOMS carve-outs.

For tailored ViDA readiness assessments, including platform audits and TOMS alignment, Antravia offers expert reviews. Visit VAT.travel for our updated 2025 compliance toolkit, or contact us for a free platform rules checklist.

Disclaimer:
Content published by Antravia is provided for informational purposes only and reflects research, industry analysis, and our professional perspective. It does not constitute legal, tax, or accounting advice. Regulations vary by jurisdiction, and individual circumstances differ. Readers should seek advice from a qualified professional before making decisions that could affect their business.
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