# EU Plans to Extend Reverse Charge Until 2030 > The EU Commission plans to extend reverse charge and the quick reaction mechanism against VAT fraud until June 2030. Source: https://www.mtrlegal.com/en/eu-plans-extension-reverse-charge-2030/ · Language: en · Updated: 2026-10-21 --- ## Commission Proposes Extending Key Instruments Against VAT Fraud The European Commission intends to keep two temporary instruments for combating VAT fraud available for longer. This concerns the optional reverse charge mechanism under Art. 199a MwStSystRL (Mehrwertsteuersystemrichtlinie, EU VAT Directive) and the quick reaction mechanism under Art. 199b MwStSystRL. Under the current legal framework, both provisions expire on 31 December 2026. The proposed directive provides for extending applicability until 30 June 2030. According to the proposal, no substantive changes to the material scope of application of the two mechanisms are envisaged. The aim is to maintain the existing instruments until the digital reporting obligations for cross-border transactions under the ViDA package take effect. ## Background: Reverse Charge and Quick Reaction Mechanism ### Optional Reverse Charge Mechanism Under Art. 199a MwStSystRL Art. 199a MwStSystRL allows Member States to provide, for certain transactions susceptible to fraud, for the transfer of tax liability to the recipient of the supply. This reverse charge mechanism is not imposed on a mandatory EU-wide basis for all covered transactions, but is available to the Member States as an optional instrument subject to the requirements under EU law. According to published information, Art. 199a is currently used by almost all Member States for at least one category of transactions. The provision is particularly aimed at situations in which VAT fraud may occur through so-called missing trader structures and carousel fraud. ### Quick Reaction Mechanism Under Art. 199b MwStSystRL Art. 199b MwStSystRL contains a quick reaction mechanism intended to enable Member States to respond more rapidly in cases of sudden and significant risks of fraud. This instrument is also temporary and is connected with the EU-wide fight against serious VAT fraud schemes. The current time limit for both mechanisms until 31 December 2026 is based on Directive (EU) 2022/890, in particular on Art. 199a(1) and Art. 199b(6) MwStSystRL as amended thereby. ## Procedural Status of the Proposed Directive ### Adoption by the Commission and Registration with the Council The Commission proposal bears the file reference COM(2026) 515 final and the procedure number 2026/0292 (CNS). It was adopted by the European Commission on 1 October 2026. The Council registered the proposal as [Document 13970/26](https://data.consilium.europa.eu/doc/document/ST-13970-2026-INIT/en/pdf) in the ECOFIN.2.B area. The document is dated 2 October 2026; the date of receipt is stated as 1 October 2026. The Commission’s Directorate-General for Taxation and Customs Union published its [communication on the proposal](https://taxation-customs.ec.europa.eu/news/commission-proposes-extending-key-anti-vat-fraud-tools-until-june-2030-2026-10-09_en) on 9 October 2026. ### Required Legislative Procedure Unanimity in the Council is required for the adoption of the proposed directive. The European Parliament must be consulted under the special legislative procedure. Adoption has not yet taken place. The proposal therefore remains in the EU legislative process. Statements on the future legal position are subject to further consideration by the competent EU institutions and the required decision-making. ## Purpose of the Planned Extension Until 2030 ### Bridging the Period Until ViDA Digital Reporting The proposed extension is intended to bridge the period until the introduction of digital reporting obligations for cross-border transactions under the ViDA package. This reform provides, among other things, for mandatory electronic invoices and real-time reporting of cross-border transactions. According to the proposal, Art. 199a and Art. 199b MwStSystRL are to remain available until 30 June 2030. This would align the time limit with the transition to digital reporting in the value added tax system. ### Response to Demands from Member States and Business According to the Commission, the proposal takes up demands from Member States and businesses. The existing instruments are to remain available for use for a further four years while work continues on the broader reform of the VAT system. The proposal is limited to extending the existing instruments. It does not contain any expansion or other change to the material scope of application of Art. 199a and Art. 199b MwStSystRL. ## Discussion on a Possible Expansion of the Scope of Application ### Demands from Individual Member States In the ongoing procedure, Austria, the Czech Republic and Germany are calling for an expansion of the scope of application of Art. 199a MwStSystRL to further transactions susceptible to fraud. The areas mentioned include, among others, certain transactions in: - real estate, - motor vehicles, - national CO2 certificates, - crypto-assets. These demands relate to the ongoing procedure and are not part of an amendment that has already been adopted. It therefore remains decisive that the present Commission proposal itself does not provide for any changes to the material scope of application. ### Parallel Procedure Concerning the German Special Authorisation In addition, the German special authorisation for the reverse charge mechanism for emission allowances under the Brennstoffemissionshandelsgesetz (German Fuel Emissions Trading Act) is the subject of a parallel Council procedure. This special authorisation was granted in 2021 and extended in 2024 until 31 December 2026. The relevant Council document of 19 October 2026 expressly refers to the expiry of Art. 199a and Art. 199b MwStSystRL as well as to the announced extension. In this respect too, this is a separate procedure that must be distinguished from the general extension of the two mechanisms under EU law. ## Significance for Businesses and Taxable Persons The planned extension concerns a central element of the EU-law instruments against VAT fraud. For businesses, the continued application of the existing rules may be of particular importance where national provisions based on Art. 199a MwStSystRL are applicable or where short-term measures under Art. 199b MwStSystRL may come into consideration. Since the proposal has not yet been adopted, the further course of the special legislative procedure remains to be seen. Until an EU-law decision is adopted, the current expiry date of 31 December 2026 remains decisive. ## Tax Law Assessment by MTR Legal Rechtsanwälte The planned extension shows that VAT risk areas and transitional arrangements under EU law can continue to have considerable practical significance for businesses. This applies in particular to [cross-border supply and service relationships](https://www.mtrlegal.com/regions/euskirchen/internationales-steuerrecht/) as well as to sectors in which reverse charge rules already play a role today. MTR Legal Rechtsanwälte advises companies, investors and high-net-worth private individuals on matters of national and international tax law. If you have legal questions regarding the VAT classification of reverse charge scenarios, developments under EU law or the effects of the ViDA package, you can find further information at [Legal advice in tax law](https://www.mtrlegal.com/rechtsberatung/steuerrecht/).