Does EU VAT apply to Middle East-based dropshippers selling in Europe?

Accounting & Taxes
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Topic summary

Inquiry from a Middle East–based dropshipper about VAT obligations when sourcing from an EU supplier and selling to other EU countries, plus a side question about sales to the US.

Key guidance provided (EU sales):

  • VAT registration required in the EU country where the supplier is located.
  • Register for the Union OSS (One‑Stop Shop) scheme to report cross‑border EU sales from that same member state.
  • Filing obligations: (1) a domestic VAT return in the registration country, and (2) a Union OSS return covering sales to other EU countries, both filed in the same country of VAT registration.

Context/definitions:

  • Union OSS simplifies VAT compliance for cross‑border B2C sales within the EU by allowing centralized reporting through one member state.

Status and gaps:

  • EU VAT approach outlined with concrete action steps (register and file two returns).
  • The question about selling to the US was not addressed; guidance for US tax treatment remains open.
Summarized with AI on January 22. AI used: gpt-5.
1

Hey,
I’m based in the middle east, and I want to dropship from an EU country supplier.
and I want to know if I will need to pay VAT when I’m selling a product from my EU supplier to another EU country ?
And what’s about to US ?

2

Hi Koren,

If you are still interested :slightly_smiling_face: . The short answer - Yes. You need to register for VAT in the country of your supplier and register for Union OSS special VAT scheme to sell throughout EU in the same country. You will have to file 2 VAT reports - domestic VAT report for the VAT registration country and OSS Union scheme report for your sales to other EU countries (filed in the same country where you have VAT registration) .