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News EU Finance Ministers approved a Proposal for General Reverse Charge Mechanism

At the beginning of October, the Finance Ministers of the European Union unanimously approved a proposal allowing member states a temporary introduction of the general reverse charge regime. The enforcement of this proposal has been among the EU-level tax policy priorities of Czech government for quite a long time. Simply said, the reverse charge regime transfers the VAT liability from the supplier to the purchaser of taxable supply to prevent the carousel frauds.  According to the European Union, this is a temporary solution to help member states facing the increased risk of these frauds.


Member states will be allowed to apply this regime by June 30, 2022 at latest, and only in case of transactions involving domestic supplies of goods and services of more than EUR 17 500, while meeting other criteria as well. The request for the introduction of this regime will be subject to unanimous approval of the Finance Ministers of member states.


We will continue to keep you informed on the further steps of the European Union and the Czech Republic related to the introduction of this regime.


Adam Pinďák

Tax Consultant

D +420 296 152 111

E Adam.Pindak@cz.gt.com