Apparently, the German Federal Ministry of Finance had considered a No-Deal Brexit on 12.04.2019 as highly probable. Thus, in its Letter of 08.04.2019, the Ministry provided information on the applicability of German VAT regulations in this instance. In the meantime this date has become obsolete again as the EU has offered a postponement till 31.10.2019. Another date which is often mentioned is 22.05.2019, i.e. the date before the European elections. If and when a “hard” Brexit may happen, is still unclear. In any case the German Federal Ministry of Finance provides specific advice on the VAT treatment of supplies of goods and ongoing services, as well as for consignment stock transactions taking place on or around the Brexit date. The letter also includes statements on procedural adaptions for MOSS, input VAT refunds, liability for operators of online marketplaces and VAT-ID validation.

With its decision of 13.12.2018 (V R 45/17), the Federal Fiscal Court decided, for the first time, that membership fees of professional associations may partially be subject to VAT which allows them to benefit from input VAT deduction. This also depends on the extent to which the professional association is exempt from corporate tax.

The recent EU level failure of the project to introduce a European-wide digital services tax has resulted in France being the first European country to draw up a bill for a national digital services tax. German companies may also be affected by this tax, the introduction of which is planned, with retroactive effect, as of 01.01.2019. Other EU Member States may now also feel compelled to introduce a national digital services tax. In addition, the French draft law is likely to influence the debate on a global digital services tax at G7, G20 and OECD level.