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The tax authorities often deny VAT deduction by saying the entrepreneur received the goods from a “defaulting trader”. Currently, the legal concept of good faith is of no importance in the assessment procedure. However, according to the latest decisions by the Federal Fiscal Court, this might be viewed differently in the future. In tax disputes, the question as to who actually bears the burden of proof regarding good faith will need to be determined.
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On 1 January 2015 the Hungarian tax authorities will introduce an electronic system designed to monitor the transportation of goods sent via truck (EKAER). Once again, VAT-registered companies in Hungary are facing additional administrative burdens which are unique within Europe. The EKAER-System requires all truck-transported goods to be reported in advance. Failing the reporting obligation will lead to default penalties of up to 40 percent of the goods’ value or even seizure of the goods. VAT-registered companies in Hungary should immediately verify to what extent the introduction of the EKAER-System affects their business activities.
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By means of its Circular dated 5 December 2014, the German Ministry of Finance has extended the interim regulation for the application of the new legal position for the supply of metal until 30 June 2015. According to this regulation, the tax authorities will not object if both parties to a supply of metal have mutually agreed that the supplier is liable for VAT. Furthermore, the legislature intends to amend the VAT Act. The list of goods concerned will be reduced. Besides that a threshold of EUR 5,000 will be implemented.
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