BERLIN (AP) — Germany’s government has initiated legislation that would make online retailers liable for sales tax that isn’t paid by vendors based outside the country.
The Cabinet on Wednesday approved the bill, which requires parliamentary approval and is slated to take effect Jan. 1. It aims to prevent tax evasion by vendors using online marketplaces such as Amazon and eBay.
Germany’s finance ministry says that foreign-based companies that aren’t registered for tax in Germany frequently fail to pay sales tax on revenue generated from sales in the country via online platforms.
Under the new legislation, those platforms will be obliged to collect information on vendors including their full addresses, tax details, dispatch and delivery addresses. In some cases, those running the platforms would be liable for tax that isn’t paid on deliveries.