///Update on mandatory B2B e-invoicing in Greece

Update on mandatory B2B e-invoicing in Greece

2019-07-02T16:02:59+00:00Juli 2nd, 2019|News|

Much has been discussed for the past year on the possible nationwide e-invoicing mandate in Greece, but things have been relatively quiet on the topic in recent months. In this article, we provide clarity and updates on the situation for our readers and customers.

Greece’s current VAT gap status

Greece, with a VAT gap of 29%, has the second highest percentage in the EU compared to its revenues. Only Romania has a higher VAT gap of 36%. The main borrowers of the Greek government – the IMF, European Commission and European Central Bank (the “Troika”) – have been demanding for years that the country get the shadow economy and VAT gap under control.

What has been done up to now?

The Independent Authority for Public Revenue (IAPR) of the Hellenic Republic has been tasked with studying the experience of other countries and creating the framework for Greece. The findings and results are as follows:

E-invoicing model

In August 2018, the IAPR proposed a nationwide e-invoicing mandate, similar to the Italian or Turkish models. Despite the proposal, the decision seems to be not to proceed with this idea, as it would require derogation by the EU commission from certain provisions of the VAT Directive. Considering that Greece, contrary to Italy, has no governmental infrastructure in place for e-invoicing, and only a handful of e-invoicing service providers operating in the country, the concern from the IAPR appears to be that they would not qualify for approval from the EU. However, no formal request has been submitted to the EU Commission.

E-bookkeeping model

As a result of the above, the IAPR has continued working on a new model, which is more focused on accounting and bookkeeping requirements and processes. This new model – even though it requires sending electronic invoices to IAPR – is more focused on the buyer and buyer’s ability to correctly account for purchase invoices, which in turn will be controlled against an online ledger held by the IAPR. Publication of relevant technical specifications has been delayed since January 2019. From what we at Pagero are aware of, implementation of this model will not only put substantial pressure and requirements on ERP and accounting software producers, but also on the accountants who will be working with it.

What to expect going forward?

As the outcome of the most recent EU Parliament elections, the current ruling party, Syriza, lost its positions and announced an extraordinary parliamentary election be held in July 2019. According to the latest polls, Syriza is expected to lose the parliamentary elections to the New Democracy party, which has been the major opposition party since 2015.

Even though the IAPR is supposed to be an independent authority, irrespective of the outcome of the legislative elections, our prediction is that the results might have significant impact on whether and how Greece will proceed with the new regulatory initiatives surrounding the VAT gap. That being said, it is hard to know at present if they will proceed with the e-bookkeeping model, return to their e-invoicing model, or scrap both in order to implement a third approach.

We do not believe that Greece will entirely dismiss the idea of digitizing tax. Rather, it is a question of which model will be implemented. For this reason, staying updated on the current situation and preparing for the future of e-invoicing remains as important as ever.

Pagero Compliance

Pagero is uniquely positioned in the industry as one of the few service providers with an in-house regulatory analysis team working on implementation and maintenance of e-invoicing and other related requirements.

In addition, Pagero co-operates with well-reputed VAT and invoicing compliance experts such as Deloitte, Thomson Reuters and Sovos Trustweaver.

Pagero Compliance services

Learn how Pagero helps companies handle local e-invoicing and other requirements globally.

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