Recent news

1 April 2021 | Elman Wall Bennett have published their latest ‘Value Added Travel’ newsletter.

25 February 2021 | We have added a new page here to address recent changes in Germany regarding VAT treatment.

26 November 2020 | Ellman Wall Bennett have published their latest ‘Value Added Travel’ newsletter on UK TOMS arrangements from 1 January 2021

08 July 2020 | Ellman Wall Bennett have published their latest ‘Value Added Travel’ quarterly newsletter. Since its publication, on 8th July the UK announced a six month reduction of the VAT rate to 5% on certain hospitality and tourism services, including food, accommodation and attractions. For operators applying the Tour Operators Margin Scheme (TOMS), David Bennett’s initial assessment is that “a standard interpretation of TOMS would require the rate to remain at 20%: supplies of accommodation etc by a business accounting for VAT under TOMS would not benefit from this reduction.  So whilst the sale of accommodation by a hotel to a tour operator or similar (i.e. any business within TOMS) would attract the 5% rate, the margin made by the tour operator would still be subject to 20%.” We will publish any further clarification when we have it.

26 May 2020 | The European Commission has launched a public consultation on new policy options for TOMS. This follows the roadmap they published indicating scope of review.

24 March 2020 | Ellman Wall Bennett have published their latest ‘Value Added Travel’ newsletter

04 March 2020 | Germany: treatment of VAT for B2B travel services. Ellman Wall Bennett have published additional detail as to practical implications and opportunities for businesses in Germany following VAT rule changes announced in December 2019.

24 February 2020 | The consultation on the  legislative roadmap setting out how the European Commission will approach the review of TOMS VAT will close on 3 March 2020.

13 January 2020 | Further to December’s update from Elman Wall Bennett we are advised that the German Finance Ministry has not agreed to a transitional period.  Accordingly, TOMS applies to B2B supplies in Germany with effect from 18 December 2019.  For those B2B suppliers which recover VAT on German accommodation etc., we understand that this means that VAT on supplies made on or after 18 December is now not recoverable.

8 January 2020 | December’s update from Elman Wall Bennett has just been published and includes updates on application of TOMS in Germany, Austria and Belgium, and a review of possible options in the UK from 2021 onwards.


How tourism is taxed is the most influential factor on business viability. The added value of intermediation is often poorly understood. Regarding VAT, the EU is at a disadvantage for three reasons: it taxes tourism exports, the price of holidays to non-EU destinations is VAT-free, and there is a bewildering array of rates applicable (discounted VAT has been shown to support job-generation).

VAT reporting and collection is complicated in a business where costs are spread over many countries, among multiple service types, with buyers in the EU or worldwide. The Tour Operators Margin Scheme (TOMS) remains an intelligent simplification: it shares tax benefit between destination and EU operator’s country of establishment; it minimises the need for multiple registration; it is relatively easy to administer.

However, it still taxes exports to non-EU clients, and provides a competitive advantage to non-EU businesses selling EU product. Relocation is often not open to small businesses on whose success tourism’s job generation depends. There is very little volume in retail sales of EU travel product to non-EU consumers.

What you need to know

  • The EU is reviewing how TOMS should operate: significant change is likely
  • There is an urgent need to illustrate the impact of options on business
  • Local taxes are becoming a more significant source of revenue

Reform of TOMS

February 2021: The European published factual report of 2020 consultation. ETOA continues to participate in expert discussion.

May 2020: The European Commission launched public consultation on future policy options.

April 2020: The European Commission published a roadmap setting out scope of policy review:

November 2019: The European Commission published a technical document summarising developments to date, current position and scope of review.

ETOA’s policy objectives

  • Sales to non-EU clients to be VAT-free
  • Tax matched by reciprocal benefit enjoyed by residents and visitors
  • Ease of compliance, with better consultation and notice of change

What we are doing

  • Lobbying and participation in expert group on legislative review
  • Expert advice through seminars, online briefings and helpline
  • Research and reports

Tax reform is complex. At an EU level, significant regulatory change requires unanimity among all member states. Tax on tourism makes sense if it improves infrastructure and service. Looking after and making accessible Europe’s cultural and natural heritage requires funding. Taxation without benefit to the taxpayer may bring short-term relief to hard-pressed budgets, but it will cause long-term competitive harm.


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Learn more

Tax and tourism: a destination management problem? February 2019

Position paper giving European perspective in response to proposed new tourism tax in Scotland. Also mentions Amsterdam, Barcelona, Edinburgh, Florence, Rome and Paris.

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