Europe EMCS - Excise Tax

European – EMCS

European Excise Management & Control System

Since the creation of the European Union Internal Market in 1993, the movements of excise goods among EU countries have been accompanied by a paper-based document, the Accompanying Administrative Document (ADD). The system was designed to ensure appropriate payment of taxes while respecting the principle of free trade among EU countries without requiring customs controls at the borders between Member States. But today, as many paper-based business processes are being automated and converted to electronic data exchange, government regulations are changing to keep pace with technology. As of April 1, 2010, companies which transport excisable goods under duty suspension are now required to migrate from traditional paper-based ADD systems to a computerized Excise Movement and Control System (EMCS) that uses electronic messages to monitor movements of excise goods. Migrations must be completed by the end of the year.

emcs

  1. The consignor submits the e-AD
  2. The Member State of dispatch validates the e-AD and sends it back to the consignor (including the AAD Registration Code – ARC)
  3. The consignor dispatches the excise goods
  4. The Member State of dispatch transmits the e-AD to the Member State of destination
  5. The Member States of destination forwards the e-AD to the consignee
  6. The excise goods arrive at destination
  7. The consignee submits a report of receipt
  8. The Member Stat of destination validates the report of receipt and sends it back to the consignee
  9. The Member State of destination transmits the report of receipt to the Member State of dispatch
  10. The Member State of dispatch forwards the report of receipt to the consignor.

 

The new regulations will have the most profound effect on companies trading in alcohol, tobacco, and energy products, which have the most commonly applied excise duties. Under EMCS, a movement of excise goods between two traders is monitored through every stage of the shipment using an electronic Administrative Document (e-AD) issued by the consignor. The e-AD must be validated by the EMCS of the Member State where it is originated. The e-AD is then transmitted electronically to the EMCS of the destination Member State, and it is forwarded to the consignee. When the goods are received, the consignee submits a report to all involved Member States and the consignor, acknowledging receipt and noting any anomalies in the shipment.

Invoiceware International Advantage

  • Fully integrated into SAP ERP & Shipping process so end users don’t have to work in an additional portal environment
  • Multi country compliance – covers electronic connectivity with multiple Member States allowing immediate and permanent compliance.
  • Centralizing know-how and overall control within SAP ERP, you can avoid expensive redundancy and upgrades/ongoing change management
  • Enables a full view on your Inbound and Outbound excise process within SAP ERP and guarantees a quick and correct follow up of each declaration.
  • Simplified end-to-end process that avoids typographical errors
  • Manages the full EMCS message set, including provisions for managing messages associated with process variations such as cancellations, redirections, partial refusals, reminders, imports, and exports.
European EMCS Excise Tax White Paper

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“Utilizing an OnDemand Compliance Network allows our internal staff to focus on strategic business activities rather than constantly researching and implementing continual changes in each country.” 

Randy Isdahl, Director SAP Process Architecture, Brown Forman Corporation 

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