Card Payment Sweden
CPS
The Card Payment Sweden is a business association who has the obligation in the interest of its members to promote its members interest in developing the payment card business in Sweden The association is open for any bank and/or Financial Institution and operating in Sweden within payment Card industry.
ID: 28095488537-94
Lobbying Activity
Response to Action Plan on fight against tax fraud
1 Apr 2020
Card Payment Sweden (CPS) is an industry association promoting the use of cashless payments by card in Sweden. CPS strives to ensure that the regulatory framework in the EU works effectively, fosters the payment ecosystem and facilitates fair competition. Our members are at the forefront of the fight against tax evasion and tax avoidance and have developed a solid expertise in integrated digital reporting of information.
(1) Combatting tax evasion
We support the significant work that is being carried out in the EU to tackle VAT fraud and improve cross-border cooperation. Nevertheless, CPS would like to point out a number of weaknesses with regards to the recently agreed set of rules, which we think need to be addressed for a successful implementation:
Clarity over the type of information to be provided: the existing rules lack clarity over what type of information PSPs should report and which acquirer and/or issuer is to provide which information. In some cases, the PSP does not even possess the asked-for information.
- In the case of card payments, the PSP of the payer – the issuer – does not possess data about the payee, other than a trade name provided for the payer to recognise the purchase, and it will not be possible to obtain this information from non-EEA acquirers, over which EU lacks jurisdiction. Therefore there is an obvious risk that issuers will have to invest heavily in reporting transaction data, which for the purposes of the tax authorities will be void of useful information, and therefore done in vain.
- The requirement of only providing data on payees with more than 25 transactions per quarter is very far-reaching for issuers, as issuing systems do not provide any statistics or accumulation on merchants. This requirement would require vast investments for issuers to comply with, especially as the calculation must be done not only on the one-leg transactions that are required for the reporting, but on all cross-border transactions, including the intra-EEA transactions for which the reporting requirement lies on the acquirer.
Systematic over-reporting: wide reporting obligations risk to overwhelm tax experts who may be unable to draw conclusions that are credible enough to act on. With this set-up, then, the reporting obligations could become a substantial burden on PSPs without there being a feasible structure for how the information would be used.
Data protection concerns: transferring vast volumes of customer related data to public registers without there being specific suspicions of criminal activity could be questioned from an integrity, GDPR and bank secrecy perspective. There will probably be problems of trust and confidence when customers – who have always been able to rely on PSPs not to pass personal data on – realize that detailed information will automatically end up in such registers.
Readiness of technologies: necessary technologies for implementing the central information system do not exist at present. In combination with the vague nature of key provisions, this means that a lot will have to be created and decided on in the implementation phase. Implementation could, in fact, become very difficult and costly.
(2) Dealing with taxes across borders
CPS welcomes Europe’s efforts to solve cross-border tax disputes and enhance tax certainty in both direct and indirect taxation.
That said, we believe that seemingly to systems implemented at the European level, international solutions should aim at guaranteeing an agile payment ecosystem. Over-regulation in this area would risk burdening PSPs to the detriment of consumers and could jeopardise the development of price-competitive and efficient digital payment systems.We encourage international solutions to embed Europe’s privacy and data protection principles as common standards will reduce fragmentation of operations and support the establishment of EU players in the international market. Posted on behalf of Michael Hoffman, CEO of CPS.
Read full responseMeeting with Paulina Dejmek Hack (Cabinet of President Jean-Claude Juncker)
11 Apr 2019 · Payment services