Value Added Tax Policy Design for the Platform Economy: Digital Reporting and Fraud Mitigation within the EU ViDA Framework
DOI:
https://doi.org/10.5281/zenodo.18525857Keywords:
platform economy, VAT, ViDA, digital reporting requirements, e-invoicing, deemed supplier, VAT fraud, compliance analytics, administrative cooperation, SMEsAbstract
The platform economy heightens the risk of VAT noncompliance by dispersing taxable activities among numerous micro-suppliers, increasing cross-border place-of-supply complexity, and expanding opportunities for evasion due to reporting delays and fragmented data. The European Union’s VAT in the Digital Age (ViDA) reforms address these risks through a data-centric approach. These reforms introduce harmonised digital reporting, structured e-invoicing for intra-EU B2B transactions, targeted platform deemed-supplier rules in specific sectors, and enhanced administrative cooperation. This paper presents a policy design prioritising transferability for small and candidate European economies, with a focus on practical implementation under capacity constraints. Through a structured instrument-to-mechanism-to-KPI mapping, the study defines platform VAT risk categories, constructs a closed-loop compliance system, and outlines a phased implementation roadmap. A comparative case study examines Hungary’s real-time invoice reporting regime versus periodic reporting, demonstrating measurable improvements in detection speed and governance, and highlighting challenges related to validation and SME enablement. Scenario-based present–future comparisons (not forecasts) indicate that phased digital reporting and platform controls can plausibly reduce compliance gaps and strengthen enforcement. Achieving these outcomes requires embedding interoperability, proportionality, and governance safeguards into system design
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