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.

In 2016, the Federal Fiscal Court had to decide, for the very first time, two cases concerning how supplies via consignment stocks are to be treated. The German Ministry of Finance has now taken on these decisions in the VAT Circular. The undifferentiated view of the Frankfurt Regional Tax Office’s Circular is now a thing of the past. Companies, be they suppliers or customers, who have not already become active after the publication of the Court’s decisions, should now examine whether their supplies, made via consignment stocks or other warehouses, are being handled correctly. This is relevant to all supplies from other EU member states as well as from non-EU countries and even for domestic supplies in Germany. Amendments can be made in a transitional phase until 31 December 2017.