Reasons Some EU Countries Are Yet to Introduce Mandatory e-Invoicing
Electronic invoicing offers numerous business benefits. Further, EU member states that have implemented the e-invoice have achieved the following:
- VAT revenue and better transactions control
- Business automation and digitization
- Improved interaction between public administrations and businesses
- Faster payments by public administrations, which is a good thing for businesses
But why isn’t B2C and B2B e-invoicing mandatory in every EU country?
The primary reason is the European Directive No. 2006/112/EC, also known as the VAT Directive, specifically Articles 218 and 232.
These articles state that invoices with the EU can be in paper or electronic format. In addition, the recipient must give consent to receive an e-invoice. As a result, introducing mandatory e-invoicing requires a nod from the European Commission via a special derogation.
Italy obtained the derogation in 2018, 2021 and an extension till 2024.
EU member states like Poland, Germany, Spain, and France have applied for derogation. Even so, European Directive No. 2006/112/EC will delete the requirement to apply for derogation in 2024, paving the way for mandatory e-invoicing in Europe for B2B and B2C sectors.