Payment Service Providers (“PSP”) facilitate merchants in the acceptance of online payments by providing a merchant account/payment gateway through which transactions can be safely and securely carried out. Typical PSP transactions include internet banking, credit/debit cards, e-wallets, etc.

To plug revenue leaks by detecting/combating VAT frauds, the European Union Council issued Directive 2020/284, mandating additional reporting obligations for payment service providers in the EU, which would take effect from January 1, 2024. It is expected that this initiative would strengthen the coordination between the tax authorities of EU members and key players in the e-commerce industry.

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