FRANCE does not have a filing deadline for VAT refund applications and implements obligation of electronic in-voicing +++ ITALY shortens period for claiming input VAT deduction +++ CROATIA regulates correction possibilities and implements simplifications as regards import VAT +++ NORWAY increases the reduced VAT rate +++ POLAND postpones implementation of the Split-Payment-System +++ ROMANIA concretizes scope of application of the Split-Payment-System +++ HUNGARY publishes details regarding the obligatory electronic transmission of invoice details
More than three years ago, the Federal Fiscal Court de-cided that hospital treatments carried out by private hospitals could be VAT exempt. To date, the legislator has not amended the German VAT law in this regard, which is contrary to European law. In its current decision, the Federal Fiscal Court points to a possible VAT exemption, based on Union law, for medical care centers which are not licensed in accordance with sec. 95 of the Social Security Code V.
The German Ministry of Finance has implemented the Court’s legislation of 11 November 2015 – V R 37/14, according to which, VAT exemption following sec. 4 no. 12 sentence 1 lit. a German VAT Act also includes the leasing of furnished rooms or buildings if the leasing is long-term. Landlords are required to implement this new legislation from 1 January 2018. Input VAT adjustments following sec. 15a German VAT Act must be made if necessary.
On 05.12.2017 the EU Finance Ministers adopted one Directive and two Regulations. These statutes will make it easier for e-commerce businesses to comply with VAT law. The MOSS procedure will, inter alia, be expanded to include distance sales. Platforms for distance sellers will be held liable for sales carried out by external merchants. A threshold for the supply of B2C services will be implemented and a lot more is introduced…
Following the German Federal Fiscal Court’s decision, liability according to sec 25d para 1 German VAT Act is subject to significant obstacles. The recipient can be held liable for VAT for supplies on a previous stage in the supply chain only in exceptional circumstances. It is not enough that the acquirer is aware that the supplier is under criminal investigation. Evidence proving that the acquirer knew of the supplier’s intention not to pay VAT for the specific revenues when contracting is a precondition for the VAT liability of the acquirer.
In its decision of 15.11.2017 in the legal cases Geissel and Butin – C-374/16 and C-375/16, the ECJ held that the address, where the issuer of an invoice carries out its economic activity, does not have to be specified in the invoice for the purpose of input VAT deduction. In the ECJ’s view, it is sufficient that the postal address used in the invoices is an address at which the supplier is contactable. This is a clear rejection by the ECJ of the rather narrow German point of view. The decision is also important as regards the recipient’s address.
With its decision of 30.08.2017 – XI R 37/14, concerning a poker player, the Federal Fiscal Court confirmed that a taxable supply requires a direct link between the supply and the remuneration. Where the provision of a payment is uncertain, the direct link might be found to be lacking. This Federal Fiscal Court decision follows the ECJ, which previously similarly decided a case concerning horse racing. In addition to many forms of racing and gaming, other sectors might also benefit from this case law.
The German Federal Ministry of Finance has expanded the zero-rating for these sectors with regard to supplies at earlier stages of the commercial chain. However, the final use must (1) already be determined at the time of supply and (2) within the scope of the zero-rating. This situation will create significant work for the companies concerned, given that compliance by the end of the year is necessary due to the fact that the zero-rating is mandatory and the non-objection regulation only applies until 31.12.2017.
POLAND plans to publish list of active taxable persons and postpones introduction of the split-payment-system +++ ROMANIA postpones introduction of the split-payment-system +++ SWITZERLAND lowers VAT rates +++ HUNGARY is being criticized by the EU Commission for its rules on the EKAER system +++ GERMANY is being criticized by the European Commission for its implementation of the VAT refund procedure
The ECJ continues to soften the right to deduct VAT as seen in the legal case Iberdrola (C-132/16). This decision reignites the discussion about the question of the VAT treatment of development costs. The German Federal Fiscal Court’s case law and administrative opinion are, once again, on trial. Moreover, the decision may also be of general importance concerning VAT deduction.