Filenews 28 September 2020 - by Petros Theoharidis
The new regulation on VAT on mobile phones, tablets, laptops and gaming machines comes into force from Thursday 1 October, which seeks to close the holes that have allowed major fraud.
In particular, the purpose of the new regulations is to eliminate the gaps that existed in EU countries and Cyprus, which allowed fraud of very large sums, with the VAT on mobile phones, tablets and laptops, which in the end the consumer paid but ended up in the pockets of the deft instead of in the coffers of the states. This phenomenon, as "F" had written since 2016, also had a significant impact on Cyprus.
In general, with the new vat legislation, as amended by the House a year ago, only the final buyer – i.e. the consumer – will pay VAT on these devices and will not be counted in other commercial transactions, from importation up to and before the retail sale fund.
In particular, where the purchaser of movables, etc. is registered in VAT, the invoice will not include the charge of 19% VAT. Essentially so, all companies will buy such equipment, without paying VAT and waiting for its return. If he is still a private buyer, he will of course also pay VAT.
The major mobile marketing companies in Cyprus are ready to start operating from 1 October with the new regime that comes into force in relation to VAT on these essentials now in each of the goodies of digital technology. Important help was to the large companies that they have special accounts and the support of audit firms that helped prepare.
It should be noted that in addition to the security net for state revenue and competition protection, the new arrangement still has a benefit for many traders – they will not pay VAT and wait a long time for its return.
However, gaps in information and preparation for the implementation of the new legislation are recorded in smaller shops selling these products, which complain of incomplete information. The Association of Telecommunications Companies (SETEL) has applied to the Ministry of Finance, requesting an extension to the implementation of the new legislation and a contribution by the Ministry, so that they can better prepare for the implementation of the changes provided for in the VAT legislation and, above all, the adaptation of their computer systems.
In the meantime, it is expected that in the next 24 hours, all wholesalers and retailers will proceed to register the existing devices they have in their warehouses and showcases, so that from 1 October the new special VAT regime for mobiles, tablets, laptops and gaming machines will also be applied in Cyprus.
