Once again, the German Federal Fiscal Court has confirmed that the German provision regarding the tour operator margin scheme is contradictory with respect to the provisions of the EC-VAT-Directive. As long as the legislator does not adjust section 25 of the German VAT Act, there are possible scenarios of non- or double-taxation in the case of cross-border supplies of travel services. Therefore, it is not only tour operators who should determine how to avoid double-taxation or whether the applicable laws allow for non-taxation. Event agencies and other industrial sector businesses recharging travel services may also be affected. Even intra-group cost transfers across the border should be monitored.
mehr