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TAXATION : IRU SLAMS UNION'S ELECTRONIC VAT REFUND SYSTEM.

According to the International Road Transport Union (IRU), the new Community mechanism in place for the refund of VAT (Directive 2008/9/CE, since 1 January, 2010) has failed and this is threatening the survival of road transport companies.

Since 1 January, the use of national web portals for VAT refunds to taxable persons who paid VAT in another member state has become the norm. For example, a road carrier can claim for fuel purchased, vehicle repairs and motorway tollsain another member state. In theory, the computerised system was supposed to facilitate the process, but the IRU now criticises the "unacceptable slowness" of national web portals and their lack of interconnection.

ON A KNIFE EDGE

"Failure to ensure the reliable and timely refund of VAT means bankruptcy for transport companies whose liquidity situation is already on a knife edge due to the economic crisis," saidaIRU President Janusz Lacny. Member states recently agreed to postpone the deadline for the submission of 2009 claims, but refused to grant the European Commission powers to lead efforts to harmonise diverging technical elements of the system. "This is unacceptable," Lacny reiterated. "This is not about national prerogatives but individual businesses and whether they can continue to function, support the economy and provide jobs." The IRU wants to see the pre-2010 paper-based submission process restored to clear the backlog of unpaid claims.

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Publication:European Report
Date:Nov 9, 2010
Words:226
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