Skip to main content

LUP Student Papers

LUND UNIVERSITY LIBRARIES

The VAT Treatment of Small Undertakings in the EU

Negash, Ruth Abraham LU (2014) HARN60 20141
Department of Business Law
Abstract (Swedish)
The thesis is concerning the VAT treatment of small undertakings in the EU. Both analytic and descriptive writing methods are used to achieve its aim.
VAT requires higher compliance costs compared with other taxes. However, the fact that the compliance burden of VAT is highly regressive as size decreases necessitates the special treatment SMEs. In line with this, the current VAT Directive also extends special treatment for SMEs mainly focusing on an exemption from VAT. Under this thesis, the denial of the right to deduct input VAT and the intra-Community transaction of small undertakings have been given special attention. The special scheme is analyzed from the perspectives of right to deduct and VAT accumulation, neutrality and fair... (More)
The thesis is concerning the VAT treatment of small undertakings in the EU. Both analytic and descriptive writing methods are used to achieve its aim.
VAT requires higher compliance costs compared with other taxes. However, the fact that the compliance burden of VAT is highly regressive as size decreases necessitates the special treatment SMEs. In line with this, the current VAT Directive also extends special treatment for SMEs mainly focusing on an exemption from VAT. Under this thesis, the denial of the right to deduct input VAT and the intra-Community transaction of small undertakings have been given special attention. The special scheme is analyzed from the perspectives of right to deduct and VAT accumulation, neutrality and fair competition and the effectiveness of the exemption of small undertakings from VAT. Furthermore, since the VAT Directive permits Member States to implement other simplification methods, the different other possible approaches have been discussed. Simplification methods that could relief from the most burdensome eras of VAT such as invoices, VAT returns, accounting methods and rates are illustrated.
Since the approach choice for special treatment of SMEs depended on from which perspective it is being analyzed, Member States need to balance between right to deduct, fairness, neutrality, fair competition, effectiveness and taxing similar goods similarly. Moreover, in order to achieve a harmonized single market, it is advisable to design on EU level simplification approach that can be implemented similarly by all Member States according to the subsidiarity principle instead of permitting each member States to implements their own simplifications independently. (Less)
Please use this url to cite or link to this publication:
author
Negash, Ruth Abraham LU
supervisor
organization
course
HARN60 20141
year
type
H1 - Master's Degree (One Year)
subject
keywords
Tax, VAT, small undertakings, SMEs, VAT accumulation, neutrality and fair competition, effectiveness, General exemption Scheme Cash flow accounting The common flat rate scheme Relying less on invoices equalization Softening reporting obligations The gradual tax relief scheme Simplifying rates
language
English
id
4456368
date added to LUP
2014-06-16 16:30:09
date last changed
2014-06-16 16:30:09
@misc{4456368,
  abstract     = {{The thesis is concerning the VAT treatment of small undertakings in the EU. Both analytic and descriptive writing methods are used to achieve its aim. 
VAT requires higher compliance costs compared with other taxes. However, the fact that the compliance burden of VAT is highly regressive as size decreases necessitates the special treatment SMEs. In line with this, the current VAT Directive also extends special treatment for SMEs mainly focusing on an exemption from VAT. Under this thesis, the denial of the right to deduct input VAT and the intra-Community transaction of small undertakings have been given special attention. The special scheme is analyzed from the perspectives of right to deduct and VAT accumulation, neutrality and fair competition and the effectiveness of the exemption of small undertakings from VAT. Furthermore, since the VAT Directive permits Member States to implement other simplification methods, the different other possible approaches have been discussed. Simplification methods that could relief from the most burdensome eras of VAT such as invoices, VAT returns, accounting methods and rates are illustrated. 
Since the approach choice for special treatment of SMEs depended on from which perspective it is being analyzed, Member States need to balance between right to deduct, fairness, neutrality, fair competition, effectiveness and taxing similar goods similarly. Moreover, in order to achieve a harmonized single market, it is advisable to design on EU level simplification approach that can be implemented similarly by all Member States according to the subsidiarity principle instead of permitting each member States to implements their own simplifications independently.}},
  author       = {{Negash, Ruth Abraham}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{The VAT Treatment of Small Undertakings in the EU}},
  year         = {{2014}},
}