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Harvesting payment data for fiscal purposes: The EU’s Central Electronic System of Payment Information
Journal of Payments Strategy & Systems,
17
(4),
372-380
(2023)
Abstract
Tax authorities in the European Union are to be given a new tool in the fight against VAT fraud: starting in 2024, payment service providers will be obliged to report substantial amounts of data on cross-border payments, to be pooled in and made accessible through the upcoming Central Electronic System of Payment information (CESOP). This paper discusses the underlying economic and fiscal motivation and outlines the legal and procedural setup of CESOP. This is then reflected by implementation requirements and challenges from the perspective of banks and other payment service providers. The paper concludes with a critical discussion of the legal framework, with particular reference to the interlinking of European payment and tax law that underpins CESOP, and an outlook on possible policy developments.
Keywords: CESOP; payment data; value-added tax; VAT; tax fraud; regulatory reporting
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Author's Biography
Sabine Weber is Director at the Association of German Banks, where she has been covering VAT law for financial services since 2002. She has previously worked with KPMG, ABN AMRO Bank and the German Mittelstand company Vaillant, where she served as Head of Tax (Germany). Sabine studied economics at the University of Dortmund and regularly contributes to the professional literature on VAT law in Germany.
Albrecht Wallraf is Associate Director at the Association of German Banks, where he engages with legislators on policy questions in the area of payments and supports the association’s members with the implementation of regulatory requirements. Albrecht holds an MSc in finance and an LLM in business law.
