Will the Court this week finally answer what the VAT fixed establishment is? Berlin Chemie, C-333/20, judgment, 7.04.2022 A German company operates in the pharmaceutical industry. The German company sells its pharmaceutical products (owned by it) in Romania to Romanian customers. The German company has an agreement to store its goods in a warehouse in Romania (the storage service is provided by a Romanian unrelated company). The German company also has a subsidiary in Romania. This subsidiary provides marketing and advertising services to the German company. These services consist of advertising the German company's goods and resolving legal issues related…

If you conduct business independently, member state cannot deprive you of the VAT taxpayer status. Flat-rate scheme for farmers does not change this. (Dyrektor Izby Skarbowej w L. (Perte du statut d’agriculteur forfaitaire), C-697/20, judgment, 24.03.2022) The Polish VAT provisions and practices regulate in a specific way the status of the taxpayer in case of agricultural activity. If natural persons run a jointly owned agricultural holding, then the VAT taxpayer is one of these persons with regard to the activity of the whole holding - the one who submitted the VAT registration form. At the same time, the other person…

Supplier of immovable property may opt to charge VAT on VAT-exempt supply only if the purchaser is VAT registered. Is such a provision compliant with VAT directive? (ARVI ir ko, C-56/21, opinion, 24.03.2022) The Advocate General will soon give his opinion on the following questions concerning the Lithuanian VAT legislation: The taxpayer (supplier) has the right to opt for VAT taxation of exempt immovable property only if the buyer is registered for VAT at the time of the transaction. Is such regulation compliant with the VAT Directive? The taxpayer (supplier) is obliged to adjust the deducted input VAT borne on…

When you buy a plot of land and transform it into building land – it is not a ‘building land purchased for the purpose of resale’ (Ministre de l’Économie, des Finances et de la Relance, C-191/21, order of 10.02.2022) According to Article 392 of the VAT Directive, the margin scheme applies in respect of ‘building land purchased for the purpose of resale’ (this is an option for the Member States to introduce this provision). In this case, French companies acquired plots of land developed with buildings. They divided it so that building lands were detached from it. The sale of…

Last week (ending 6/03/2022) no judgments and 1 opinion was issued. Below you will find a summary. A holding company purchases services in order to transfer them as a contribution to a VAT exempted subsidiary – it cannot deduct VAT and it is an abuse of law Finanzamt R (Déduction de TVA liée à une contribution d’associé), C-98/21, opinion, 3.03.2022   The German company W had 2 subsidiaries. Those subsidiaries carried out construction projects consisting in the construction of buildings and sale of apartments. These sales were to be exempt from VAT. W acquired certain services of considerable value relating…

Week 21-27.02.2022 brought 3 judgments and 1 opinion in VAT cases in the Court of Justice of the EU. Below you will find the summaries. My supplier failed to deliver, I purchased repair services and passed the cost onto him – such charge is subject to VAT Suzlon Wind Energy Portugal, C-588/20, judgment of 24.02.2022 A Portuguese company was involved in the supply of turbines for wind farms in Portugal. To fulfill its customers' orders, its Indian affiliate supplied wind turbines for it to Portugal. The turbines turned out to be defective. The Portuguese company purchased goods and services in Portugal to…