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May 08, 2015

EU unveils big plans for single digital market

EU unveils big plans for single digital marketThe EU executive has set out plans for a digital single market in Europe, covering everything from broadband coverage to copyright rules and courier rates.

Andrus Ansip, the European Commission vice-president, said Europe would be left behind if it did not create a level playing field for online businesses and consumers.

According to Commission figures, only 15% of online shoppers in the EU buy items in another country and just 7% of SMEs sell across borders. Ansip said European GDP could be increased by €415bn a year if there was a harmonised market in digital services.

John Longworth, director general of the British Chambers of Commerce (BCC), said: "For too long the completion of the single market in digital services has moved forward at a snail's pace. If the single market allows Britain's world-beating digital companies to trade more easily across borders, the UK economy stands to benefit from growth opportunities here at home, as well an improved export performance abroad."

But Longworth warned that new regulation could bring in more red tape. "With these initiatives, the devil is in the detail," he said. "The Commission and Whitehall must have a laser sharp focus on protecting firms from the risk of additional burdens and unintended consequences stemming from new regulation."

John Allan, national chairman of the Federation of Small Businesses (FSB), said: "The strategy has a great many good ideas for how a single digital market could work – such as those to cut data roaming charges and parcel delivery costs."

He added: "Our members will also be encouraged by the new focus on the effect of VAT rules changes for e-services on small businesses. This was a poorly handled change. To avoid these problems in future, we strongly urge the Commission to 'Think Small First' before making any new proposals."

The new EU VAT rules came into force this year and online merchants had until April 20, 2015, to complete their first return and make a payment. According to Taxamo, many firms have struggled to comply.

John McCarthy, ceo of Taxamo, said: "It's been challenging as many specific requirements were not released until very late in the day. Many merchants who took a more 'DIY' approach found themselves missing key information when it came to the time to file."

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