The adoption of ViDA (Council Directive (EU) 2025/516) represents a fundamental shift in the way national digital reporting obligations for VAT purposes should be understood from July 1 2030.
Over recent years, many EU member states have designed, implemented, or announced national e-invoicing systems, transaction-based reporting obligations, and real-time reporting mechanisms with legitimate objectives, including improving tax control, combating VAT fraud, and modernising the relationship between tax administrations and taxpayers. However, the entry into force of the new EU framework requires the revisiting of a question that has so far received little attention: to what extent may member states continue to maintain or introduce national reporting obligations once the EU has decided to harmonise this area?
The starting point is Article 273 of the VAT Directive, as amended with effect from July 1 2030. Traditionally, this provision has allowed member states to impose additional obligations to ensure the correct collection of VAT and to prevent tax evasion. It has provided the legal basis for many national transaction-based reporting systems.
ViDA, however, changes the context in which Article 273 must be interpreted. Once the directive establishes harmonised digital reporting requirements (DRRs), covering both intra-Community and domestic B2B transactions, Article 273 no longer functions as a broad legal basis for national reporting obligations. Instead, its scope becomes considerably more limited.
The limits of Article 273 under ViDA
ViDA does not prohibit all national information or record-keeping obligations. Member states will continue to be free to introduce audit mechanisms, data retention requirements, and reporting obligations relating to transactions that fall outside the harmonised DRR framework. The clearest example concerns B2C transactions, where national regulatory autonomy will remain broader. However, once a B2B transaction falls within the scope of the harmonised DRRs, the ability of member states to impose additional general reporting obligations is substantially reduced.
Convergence with ViDA should not be understood merely as the adoption of common electronic formats. It should also entail functional convergence. If the purpose of ViDA is to establish a harmonised European digital reporting framework, it is difficult to argue that the same B2B transaction should simultaneously be subject to several national reporting channels, each with different deadlines, data sets, or reporting authorities.
This debate is particularly relevant because many member states are currently implementing new national reporting systems that will have to coexist, albeit only for a relatively short period, with the future European framework. Some systems distinguish between large and small businesses; others introduce sector-specific reporting obligations; others continue to operate several parallel reporting mechanisms. Such diversity may have been understandable before harmonisation. It becomes far more difficult to justify once the European legislator has established a common framework for B2B transactions.
It should also be recalled that not all national systems are subject to the same transitional rules. Existing real-time transaction-based reporting systems that were already in force, authorised, or legally provided for before January 1 2024 may benefit from the transitional regime introduced by ViDA and converge with the new framework by 2035. By contrast, systems introduced after that date must comply with the new framework by 2030.
One transaction, one reporting obligation?
One principle appears to emerge that follows logically from the harmonisation pursued by ViDA: a single B2B transaction should give rise to a single general digital reporting obligation. This does not limit the supervisory powers of tax administrations. Rather, it seeks to prevent digitalisation from resulting in an accumulation of overlapping reporting obligations requiring taxpayers to submit the same information several times through different systems.
The coexistence of multiple reporting channels for the same transaction not only increases compliance costs for businesses, it also creates inconsistencies between data sets and requires additional reconciliation processes. One of ViDA’s stated objectives is precisely to reduce this fragmentation and promote a common digital VAT environment across the EU.
For this reason, it may be time for member states to interpret convergence with ViDA more broadly than as a purely technological exercise. Aligning national systems with the European syntax and reporting deadlines is undoubtedly necessary, but it is unlikely to be sufficient. Convergence also requires member states to reconsider the architecture of their national reporting systems in order to ensure that general reporting obligations do not continue to coexist where they pursue the same purpose and relate to the same B2B transactions.
The transitional period leading up to 2030 should therefore be used not to consolidate new parallel reporting systems but to simplify national reporting frameworks progressively and align them with a single digital reporting ecosystem. Otherwise, there is a real risk that ViDA will fall short of its principal objective, which is establishing a European VAT reporting system capable of replacing the current proliferation of national reporting obligations.
National legislators would be well advised to bear this in mind, as the choices they make over the coming years will largely determine whether ViDA succeeds in delivering real harmonisation or merely adds another layer to an already fragmented compliance landscape.
