Sant’s proposals on SMEs operating in small economies adopted by ECON
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Several of MEP Alfred Sant’s proposed changes to the European Commission text on a special VAT Exemption Scheme for small enterprises across the EU, have been adopted by the Committee on Economic and Monetary Affairs of the European Parliament (ECON).
The Maltese MEP’s amendments focused on facilitating the operations of small enterprises in small economies similar to those in Malta and Gozo.
Dr Sant explained that the scheme updates existing arrangements by which small and medium sized enterprises are exempted from certain VAT obligations that are administratively burdensome for them. It also extends the exemption system to SMEs that begin to export.
ECON supported MEP Sant’s proposal that only maximum turnover thresholds for small enterprises should be set for exemption. This should be done for the sake of flexibility and to ensure that it is possible for Member States to set appropriate lower thresholds proportional to the size and the needs of their economy.
It also adopted his amendment in favour of SMEs that exceed the ceiling set for exemption in a given year. The Commission proposed that as soon as this happens, the exemption ceases.
Sant proposed that this would happen if the ceiling is exceeded two years in a row to counter the impact of seasonal or irregular factors on demand.
MEP Sant stressed that making the VAT process simpler for SMEs should by no means allow for facilitating abuses or disappearance of tax money.
The report is expected to be discussed at the Plenary of the European Parliament in September.