The number of EU Member States where e-invoicing is mandatory is rapidly increasing

This year marks a significant turning point in the adoption of electronic invoicing in the European Union (EU), as a large group of Member States transitions from voluntary use of e-invoices to mandatory implementation. Until now, e-invoices have primarily been used in public administration or in cooperation between businesses and public sector institutions. However, starting this year, an increasing number of countries are introducing a requirement for private companies to issue machine-readable invoices to one another. According to the “VAT in the Digital Age” (ViDA) initiative, the implementation of digital solutions is necessary to combat VAT fraud, improve tax administration efficiency, and adapt the VAT system to the digital economy.

Several countries are now fully joining Italy, the EU pioneer in the implementation of e-invoicing. In Croatia, since January 1, all businesses registered as VAT payers are required to prepare invoices electronically. In Poland, e-invoicing became mandatory for large companies on February 1, and all other companies followed in April. In France, from September 1, all VAT payers must be able to receive e-invoices, while large and medium-sized companies must both issue them and be able to prepare electronic reports. 

In Greece, where e-invoicing was already in effect for both transactions with public sector institutions and between businesses, additional requirements for issuing invoices based on revenue thresholds have been introduced starting in February. Requirements will also be strengthened in Germany starting next year. The mandatory receipt of structured e-invoices in public administration has been in effect since January 2025, and the requirement will now also apply to the private sector.

In Estonia, Lithuania, Finland, and Spain, e-invoicing is mandatory for all transactions with the public sector. In Estonia, companies have the right to request an e-invoice from another company, although mandatory circulation is being introduced gradually. In Sweden, e-invoicing in public administration has been standard practice for years, using the Peppol network.

Initially, it was planned that e-invoicing would also become mandatory for all businesses in Latvia starting this year, thereby positioning Latvia among the EU’s leading countries in the implementation of e-invoicing. However, due to significant challenges, the transition period has been extended until January 1, 2028. As a result, e-invoicing is currently mandatory only for companies that cooperate with public sector institutions. This requirement came into force on January 1, 2025, and since then, public institutions accept only documents that are prepared, sent, and received in a structured electronic format, are automatically processable, and comply with the EU standard LVS EN 16931-1:2017. 

“The comprehensive EU-wide VAT reform marks a fundamental turning point in both tax administration and business operations across the European Union. Under the ViDA Directive, starting from July 1, 2030, structured e-invoices will be mandatory for cross-border transactions between businesses in Member States. This means that existing PDF or paper invoices will no longer be considered sufficient. Furthermore, with the introduction of e-invoicing in cross-border transactions, all Member States will be required to implement Digital Reporting Requirements (DRR), which will allow tax authorities to receive essential transaction information in near real time. Therefore, exporters, importers, and other companies must begin preparing for the new requirements in a timely manner and implement appropriate solutions. However, users of Jumis accounting and business management systems need not be concerned about these issues, as our software incorporates all the latest legal requirements in a timely manner,” emphasizes Viesturs Slaidiņš, Head of Jumis Pro, adding that structured e-invoices have been supported in the Jumis accounting system since autumn 2021.

It is projected that the comprehensive introduction of e-invoicing across the EU will significantly reduce the VAT gap. The “VAT Gap Report 2025” highlights that the VAT gap across the EU in 2023 was 1.6% lower than in 2019. However, it remains relatively high at 9.5%. This means that Member States have failed to collect nearly one-tenth of total VAT revenue that would otherwise have been received if all businesses had fulfilled their tax obligations in good faith. E-invoicing reduces opportunities for VAT evasion, meaning that, in the best-case scenario, national budgets will, on average, be nearly 10% larger than before. In Latvia’s case, however, this increase is expected to be around 5%, as the VAT gap has already been reduced from 10.1% in 2019 to 5.4% in 2023 over the past four years. For Lithuania, the potential budget increase could reach as much as 15.1%, while for Estonia it is estimated at 10.3%.

 

About Jumis Pro

SIA Jumis Pro develops and maintains the Jumis accounting system and offers three modern modules: Jumis Finance – a solution for business needs; Jumis People – a tool for employee record-keeping, salary calculation, and tax management; Jumis My Assistant – a self-service portal for employees where they can quickly view their digital payslip, submit expense reimbursement documents, request leave, track working hours in timesheets, and review received e-invoices from e-addresses and other senders before they are entered into the accounting system.

More information:

Ekaterina Chernobrovaya

Marketing Manager at Jumis Pro

Email: [email protected]

Mobile: +371 29198543