If the publication of the Creation and Growth Law, at the end of 2022, was a take off point for the Electronic Invoice in Spain, this impulse will be reinforced by the implementation of Project ViDA (VAT in Digital Age) in which the European Union hopes to increment the fight against tax fraud with the new account reporting system using electronic invoicing between companies.
Creation and Growth Law
At the end of September 2022, the Law of Creation and Growth was published in the Official State Bulletin (BOE), whose main objectives are to facilitate the creation of companies, favor the growth and expansion of SMEs, reinforce business financing and fight against late payment.
In relation to the Electronic Invoice, article 12 of the Creation and Growth Law establishes the obligation for companies and freelance professionals to issue their invoices in electronic format, with the double objective of digitalizing the business fabric and fighting against double accounting and reducing tax fraud.
The Law allows for the period of 1 year for implementation of the Electronic Invoice for companies with billing higher than 8 million euros and 2 years for companies and freelance invoicing less than 8 million annually. However, these periods will not count until the technical regulation is established, approximately 6 months after the law is published in the BOE.
The main objective of the ViDA project is to harmonize the VAT declarations of all European Union countries. Value Added Tax is the most important tax collection tool of the Union, representing 12% of its total budget, but its regulations have become obsolete, and its control is not effective. It has therefore been decided to update VAT policies and adapt them to the current digitalization context.
The way to achieve harmony of VAT is the introduction of the electronic VAT declaration in real time through electronic invoices. It is a complex project due to the need to pool different regulations and reach cross-border agreements. Final implementation is scheduled for 2025.
The Electronic Invoice
In this context, e-Invoicing solution providers will become the great allies of companies to adapt to both Spanish and European regulations. It will be very important for e-Invoicing providers to be able to adapt to all the requirements of the different regulations and interconnect with all the Administrations.
According to Jaume Escandell, our CCO, “in virtue of the changes that are approaching, companies and freelance workers throughout Europe will have the difficult task of collection and analysis of information so the Electronic Invoice supplier they choose will not only be able to satisfy the management of invoices but also be technologically prepared for the interconnection of companies and European public administrations.”