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VAT News 28/2013
Scheme for travel agents requires reinterpretation after ECJ decision
Within the EU two different interpretations of the special scheme for travel agents exist, the traveler-based approach and the customer-based approach. In cross-border transactions this could result in double-taxation or non-taxation. In its decisions of 26 September 2013, the ECJ came to the conclusion that the EC-VAT-Directive must be interpreted uniformly by following the customer-based approach. Consequently, the national regulations following the traveler-based approach, like Art. 25 of the German VAT Act, have to be put to the test.
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VAT News 27/2013
A look across the border
Currently, the fight against VAT fraud is on everyone’s mind. The EC-Directive on the Quick Reaction Mechanism as well as the EC-Directive on the optional application of the reverse-charge mechanism became effective on 15 September 2013. Furthermore, according to a recent study, 2011 VAT losses amounted to approximately 193 billion euro. Hence, it is not surprising that the EU member states are, in addition to VAT rate changes, focusing their attention on measures to fight tax fraud.
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VAT News 26/2013
News from the Federal Fiscal Court regarding chain transactions
On May 2013, the XI. Senate of the German Federal Fiscal Court passed its latest judgment regarding chain transactions. It is the subsequent decision to the ECJ’s judgment regarding the legal case VSTR (judgment of 27 September 2012 – C-587/10). The key question is about determining to which of the supplies the transport should be ascribed if the middle entrepreneur transports or dispatches the goods. The XI. Senate rejects the jurisdiction of the V. Senate and its assignment criterion. From the XI. Senate’s perspective, the German VAT administrative guidelines contradict the ECJ’s jurisdiction.
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