Hogg Robinson and the EU

HOGG ROBINSON, the travel management company (TMC), is at the forefront of a pan-EU campaign, supported by American Express, Carlson Wagonlit and others, to influence the interpretation of the new EU regulations coming into effect 1 January 2010, insofar as they relate to the VAT treatment of hotel booking fees.  The EU is split as to whether the VAT rules apply to the country in which the TMC's client is located (Article 44) or the country in which the hotel is located (Article 47).  The former position is essentially where TMC's are today and is consistent with the VAT treatment of normal business expenditure.  A shift to Article 47 would mean the TMC's fees suddenly become subject to multi-jurisdictional VAT regimes and result in complex and costly administration for both the TMC's and their clients.  What Hogg Robinson and the others are saying is that urgent clarification is needed and that deeming TMC hotel booking fees as taxable under Article 44 is clearly the only workable option going forward for everyone. Read a more detailed report

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