ICC International Best Practices and Guidance on VAT Implementation

As the world business organization, ICC works to promote international trade, responsible business conduct and a global approach to regulation.

ICC recognises that governments are increasingly relying on indirect taxes for revenue, whether it be by implementing a Value Added Tax (VAT) for the first time, such as case the with the Gulf Cooperation Council or by updating and expanding their existing laws, such as the case in the United Kingdom. The area is also becoming more dynamic – as additional players begin to collect VAT, decisions are taken faster. As a result, there is an accelerated risk that businesses will be caught unprepared.

The purpose of this document is two-fold in that it provides guidance for government representatives outlining the key features of an efficient VAT system and provides practical guidance for businesses from inception to implementation. The ICC Guidance can be used as a starting point by governments around the world planning to introduce a VAT in their jurisdiction, and by businesses in countries where VAT is planned to be implemented.

The ICC Guidance builds on existing best practices, but also includes recent pre- and post-implementation practical experiences by businesses around the globe to further illustrate some of the complexities involved with VAT implementation. The ICC Guidance adds further value in that it provides a detailed approach and sets forth the process for holistic implementation, emphasizing that working together – both business and tax administrations. –  throughout the phases of implementation can benefit all parties involved.

With more countries planning to implement a VAT regime, this document can serve as a helpful guide to provide support before and during its implementation.