EESPA Position Paper on Electronic Invoicing and VAT Compliance in Greece
Summary: The European E-invoicing Service Providers Association (EESPA) is grateful for the opportunity to present an opinion and recommendations in relation to the introduction of the myData project in January 2022. We fully understand the objective of the Independent Agency for Public Revenue to improve fiscal efficiency and the reporting of taxpayer transactions and strongly welcome the use of electronic invoicing to support the process. We are however deeply concerned about the potential damage to the wider benefits of electronic invoicing and broader supply chain automation, which could be caused by a proposed regime that discriminates against the many service providers which operate in the EU digital single market but are not able to satisfy some of the local accreditation procedures stipulated under the currently described myData scheme. We strongly believe that it should be possible to organise a more ‘open’ accreditation scheme (as is common in other Member States), whilst protecting the integrity and secure operation of the tax reporting process.
EESPA’s understanding of the current regulatory situation
Fiscal Compliance Centered on myDATA
The IAPR (the Independent Authority for Public Revenue) of Greece has launched the project myDATA, which is a reporting mechanism for summarized outbound and inbound invoice data (the so-called synopsis), their accounting classification, as well as other accounting entries, including but not limited to amortization, depreciation and salary statements.
After several schedule changes since its initial announcement, most of the myDATA reporting schema is now slated to become mandatory for all taxpayers established in Greece as of 1 January 2022. Taxpayers can fulfill their reporting obligations either via a direct integration from their ERP system, by manual submission via myDATA UI, or (partially) by using certified service providers which also issue and send e-invoices on behalf of the taxpayers. Taxpayers are free to issue and exchange e-invoices by themselves or using other means or third parties.
Business-to-Government Electronic Invoicing
In a parallel development, the Greek Government has also announced its plans to mandate e-invoicing for suppliers to contracting authorities (known as B2G e-invoicing) utilizing the Peppol Network.
Greek B2G suppliers will be able to meet this requirement by contracting service providers approved by GSIS (the General Secretariat for Information Systems). In order to be approved by GSIS, a service provider must among others fulfill the following requirements:
- Be accredited by IAPR as service providers under the myDATA reporting schema, and
- Be accredited by OpenPeppol and pass the technical test by KE.D (the National Interoperability Centre at GSIS)
One of the conditions in order to be accredited under the myDATA reporting schema is that the software provider is established in Greece. While this accreditation is optional, and non-accredited service providers from any country can freely offer non-accredited e-invoicing services in Greece, the scheme creates a level of discrimination for non-established service providers because the use of accredited service providers awards certain fiscal incentives to Greek taxpayers. This discrimination is further reinforced by the coupling of the myDATA and B2G regulatory regimes, as described above. Whilst far from ideal, it is theoretically possible for a non-accredited, non-established service provider to (continue to) provide e-invoicing services without myDATA accreditation by virtue of the strength of its services – e.g., centralization of trading partner data exchange for a multination company including Greek subsidiaries – the ability to send invoices to the Greek public administration is a condition for the provision of a minimum viable e-invoicing services portfolio for the Greek market.
While little time is left before 1 January 2022, EESPA would like to enter into a dialogue with the Greek authorities with a view to developing a common understanding of measures available to Greece to maximize the use of electronic invoicing for supply chain automation in Greece by:
- Re-examining the economic and EU Internal Market impact, as well as the legal foundation, of the requirement for service providers accredited under myDATA to be established in Greece; and
- Decoupling the requirements related to myDATA from the B2G e-invoicing requirements.
Our argumentation for these recommendations is summarized below.
Lack of a rationale for an establishment criterion for myDATA accreditation
Given how the role of accredited service provider has been designed under the myDATA schema, there is no discernable rationale for requiring such provider to be established in Greece. One good reason could have been if the service provider acted on behalf of the local tax administration; however, this is not the case: under the myDATA reporting scheme, it is the myDATA platform governed by IAPR that assigns the MARK (universal unique identifier) to the submitted data, not the service providers.
Economic Impact and Market Barriers
The essential purpose of the two regimes differs substantially.
- Generally, the coupling of these two regimes creates a de facto bias towards e-invoicing processes that do not maximize economic efficiencies.
myDATA is a reporting obligation, while Peppol is an e-invoicing framework. When combined with e-invoicing, myDATA encompasses the submission of accounting data to the IAPR prior to the issuance of an invoice. This data is submitted in the form of a synopsis (where data is aggregated), while e-invoicing data is by definition, in order to enable full automation, presented on a line-item level. Moreover, the synopsis must include data on how the taxpayer has classified the items based on their VAT treatment according to newly established income and expense classification; this data is not present on an invoice and typically not processed by service providers focused on automating trading partner data exchanges.
Whilst EESPA understands that there are vendors (e.g., of certain types of accounting or business process management software) in the Greek market whose functional scope allows the combination of both types of operations, such vendors will typically view e-invoicing as a relatively limited extension of their core functionality rather than focusing on delivering broader supply chain efficiencies by automating broader sales and purchase data such as purchase orders, advance shipping notices etc.
It is generally accepted in the software market that building and maintaining solutions for internal business and accounting functions is a structurally different specialization from building and maintaining software focused on optimizing the automation of trading partner data interchange. It may be counterproductive – or in some cases impossible – for such specialized service providers to adjust their processes to provide the required e-reporting data.
As a result of these market differences, Greece’s opportunities to maximize both the fiscal benefits of digital reporting and the economic benefits of supply chain automation may over time be diminished.
- The linking of the two regimes creates a market entry barrier for non-Greek service providers.
It is very common that business data interchange service providers operate in multiple jurisdictions, supporting both subsidiaries of their international customers and local businesses. Within the EU, such service providers play an important role in the further development of an integrated internal market, which is a key pillar of European economic policy and competitiveness. This open approach is also a key factor in the Peppol Network, which is a worldwide interoperability framework where service providers must pass certification in order to be able to operate. These service providers are typically focused on exchange of transaction messages, such as invoices, between trading parties.
The requirement to be accredited under the myDATA reporting schema will exclude from operating in Greece all Peppol service providers, both those who are already offering services to local businesses and those who would want to enter or expand in the market on the back of the upcoming B2G e-invoicing mandate.
About EESPA: EESPA was formed in 2011 as an international not-for-profit association to be a strategic asset for its members delivering industry leadership, influence and a framework of support. It acts as a trade association at a European level for a large and dynamic community of e-invoicing service providers, drawn from organizations that provide network, business outsourcing, financial, technology, and EDI (electronic data interchange) services. With its current over 80 full and associate members, EESPA focuses on public policy issues, the creation of an interoperable eco-system and championing the widespread adoption of e-invoicing for the benefit of economic efficiency and growth.
More info : www.eespa.eu
Contact: Erik Timmermans: firstname.lastname@example.org – +32/4220.127.116.11