BDO Indirect Tax News

Introduction

We begin 2026 with two articles exploring how shifting indirect tax rules are reshaping compliance obligations for companies worldwide. In the EU, the Carbon Border Adjustment Mechanism continues to develop, with recent changes designed to ease the burden on importers. These include simplified reporting, a delay in full financial obligations, a new mass‑based threshold that will exempt many small businesses and additional support for EU producers exposed to carbon leakage. The EU is also preparing for future scope expansion and updated rules for certificate sales from 2027. Meanwhile in the US, businesses entering or operating in the market—particularly those in the tech sector selling software, SaaS and digital access—face increasingly complex sales and use tax compliance obligations. These companies should regularly reassess both their nexus profiles and the taxability of their products and services to effectively manage their compliance.

Several jurisdictions have announced VAT, GST or sales tax rate changes for 2026. This issue highlights developments in Belgium, Finland and Malaysia, along with a consolidated table summarizing rate adjustments across other countries. Thailand has overhauled its rules for online purchases of imported goods; beginning in 2026, such transactions are subject to both a 7% VAT and import duties. France has also undertaken a major reform of its VAT framework by consolidating all VAT‑related provisions into a new code.

Looking ahead, 2026 appears poised to be a year of heightened tax enforcement globally, particularly as governments confront budget and revenue shortfalls. Canada has intensified its scrutiny of marine shipments, Chile is requiring platform operators to verify the tax compliance of platform users and the UK is seeking additional revenue through new duties targeting specific gambling activities.

Also in Canada, the government has moved to repeal the underused housing tax. In Spain, two courts have issued decisions clarifying the application of the reduced VAT rate in certain real estate transactions.

E‑invoicing continues its global expansion. The EU’s ViDA package represents a transformative shift in the VAT landscape, with one of its core pillars being the introduction of mandatory e‑invoicing and digital reporting for cross‑border transactions, effective 1 July 2030. E-invoicing applies to large companies in Angola as from 2026 and is now mandatory in Belgium. Burkina Faso and The Gambia are introducing mandatory e‑invoicing, and Slovenia will require e‑invoicing for domestic transactions starting in 2028. Three jurisdictions have announced further delays to aspects of their e‑invoicing mandates: Spain has postponed the rollout of its Veri*factu system; Portugal has delayed the electronic signature requirement and implementation of the standard audit file; and Türkiye has postponed the application of the e‑archive invoice system for small taxpayers. Affected businesses in all jurisdictions should begin planning now and invest in the digital solutions needed to ensure compliance.

Finally, on the trade and tariff front, China has expanded its restrictions on rare earth and permanent magnet exports. The US has introduced new tariffs on certain chips but tariff increases on certain upholstered furniture, kitchen cabinets and vanities are deferred to 2027 and President Trump has also announced that countries that do business with Iran will be subject to a 25% tariff if they trade with the US.