The European Commission (EC) has proposed simplifying value-added sales tax (VAT) requirements for online retailers on Thursday, in a measure that could boost Internet commerce.

The Commision has already published plans to make parcel deliveries more affordable, protect consumers when they buy online and to limit "geo-blocking", the practice of barring consumers in one country from buying from a provider in another.

"We are delivering on our promises to unlock e-commerce in Europe ... Now we simplify VAT rules: the last piece in the puzzle," said Andrus Ansip, the Commission's vice president for digital affairs.

Currently, online traders of goods have to register for VAT in each of the EU countries to which they sell goods. Under new rules, European companies selling goods online will be able to cover all their VAT obligations across the bloc via their own national tax authorities.

The Commission said simplified rules on VAT would save EU businesses 2.3 billion euros and would also make it easier for smaller companies to trade across borders.

To support start-ups and small traders, companies would be able to sell up to 10,000 euros to other countries in the EU and treat them as domestic sales subject to local VAT rules.

The new rules should also ensure VAT is paid in the country of the final consumer and help governments recoup some 5 billion euros of last VAT from online sales per year.