ECJ Cases Summary – October 2025

The following VAT-related rulings were issued by the European Court of Justice (ECJ):

• Case C-535/24, Svilosa AD: Directive 2006/112/EC – Article 2(1)(c) – Supply of services for consideration – Article 24(1) – Supply of services – Article 26(1)(b) – Supply of services free of charge that are to be treated as a supply of services for consideration – Debt recovery – Debt recovery in favour of a third party.
• Case C-101/24, XYRALITY GmbH: Directive 2006/112/EC – Article 28 – Taking part in a supply of services – Articles 44 and 45 – Place of supply of services – Article 203 – VAT entered on an invoice – Electronically supplied services – App store – ‘In-app’ purchase.
• Case C-234/24, Brose Prievidza, spol. s r.o.: Directive 2006/112/EC – Article 138(1) – Directive 2008/9/EC – Article 4(b) – Refund of VAT to taxable persons not established in the Member State of refund – Principal supply and ancillary supply – Artificial splitting of a single supply – No dispatch of the object of the supply.
• Case C-232/24, A Oy: Directive 2006/112/EC – Exemption relating to the granting of credit – Article 135(1)(b) – Exemption relating to financial transactions – Debt collection – Article 135(1)(d) – Trade factoring – Invoice factoring.
• Case C-744/23, T.P.T.: Directive 2006/112/EC – Article 2(1)(c) – Supply of services for consideration – Article 9(1) – Taxable person – Legal assistance provided free of charge by a lawyer to a party in legal proceedings – Payment of that lawyer’s fees by the unsuccessful opposing party.

Poland Can Still Restrict Input VAT Deduction on Vehicles The EU Council has authorised Poland to continue capping input VAT deduction at up to 50% on the purchase, intra-community acquisition, import, hire, and leasing of certain motor vehicles if not exclusively used for business purposes. This restriction also applies to related expenses and will remain in effect until 31 December 2028.

European Commission Report on VAT Derogations A recent European Commission report on VAT rate derogations highlights that Ireland and Italy make the most extensive use of special VAT reductions in the EU.

Proposal: Extension of Italy’s Input VAT Deduction Restrictions on Vehicles The European Commission has published a proposal authorising Italy to continue applying special measures that limit input VAT deductions on the purchase of certain motor vehicles to 40% until December 2028.

ECJ Cases Summary – September 2025

The following VAT-related ruling was issued by the European Court of Justice (ECJ).

Case C-726/23, SC Arcomet Towercranes SRL: Directive 2006/112/EC – Article 2(1)(c) – Concept of “supplies of services for consideration” – Commercial services provided within the same group of companies – Transfer price – Articles 168 and 178 – Right to deduct VAT – Supporting documents

ECJ Cases Summary – August 2025

The following VAT-related rulings were issued by the European Court of Justice (ECJ):

• Case C-794/23, “P GmbH”: Article 203 – Incorrect VAT amount invoiced – Article 238 – Simplified invoicing – Distinction between non-taxable persons and taxable persons who do not have a right to deduct VAT – Estimations by tax administrations.
• Case C-602/24, “W. sp. z o.o” : VAT exemption on indirect exportation of goods – Article 146(1)(b) – Relevance of intention of parties at the time of the sale – Principle of fiscal neutrality.
• Case C-433/24, “Galerie Karsten Greve” : Special arrangements for second-hand goods, works of art, collectors’ items and antiques – Taxable dealers – Margin scheme – Article 316(1)(b) – Concept of ‘supply of a work of art by the creator’ – Applicability when supply made by a legal person.
• Case C-375/24, “Keesing Deutschland GmbH”: Article 98 – Option for the Member States to apply reduced VAT rates – Whether books with number-based sudoku puzzles fall under Combined Nomenclature (CN) heading 4902, covering printed books.
• Case C-427/23, “Határ Diszkont Kft”: VAT exemption on exportation – Article 146(1)(b) – Whether service for the administration of VAT refunds to customers not resident in the European Union is a principal or an ancillary supply – Article 146(1)(e) & Article 135(1)(d) – Protection of legitimate expectations – Taxable amount.

Agenda of the Next Meeting of the Working Party on Tax Questions

The Working Party on Tax Questions published the provisional agenda for its meeting on 11 September 2025, including notably:

• An update from the European Commission on planned amendments to the EU–Norway Administrative Cooperation Agreement
• A briefing on the ongoing reform of the Union Customs Code
• Discussion on a proposal for a Council Directive amending Directive 2006/112/EC concerning distance sales of imported goods

ECJ Cases Summary – June 2025

The following VAT-related rulings were issued by the European Court of Justice (ECJ):

• Case C-808/23, “Högkullen AB”: Article 72 and 80 – Open market value – Determination of the taxable amount for intra-group services charged by a parent company to its subsidiaries.
• Case C-733/23, “Beach and bar management EOOD”: Article 273 – Article 49(3) and Article 50 of the EU Charter of Fundamental Rights – Duplication of criminal and administrative penalties in respect of the same offence – Principle of proportionality.
• Case C-605/23, “Ati-19 EOOD”: Article 273 – Article 47, first paragraph of the EU Charter of Fundamental Rights – Right to an effective remedy – Judicial review of penalties limited to potential harm that may arise from implementing the measure.
• Case C-276/24 , “KONREO, v.o.s.” – Article 205 – Possibility of holding the recipient of the supply jointly and severally liable for payment of VAT due from the supplier – Combating VAT evasion – Principle of proportionality.
• Case C-785/23, “Bulgarian posts EAD”: Article 132 – Exemptions for certain activities in the public interest – Concepts of “public postal service” and “service in the public interest”.

40th Meeting of the VAT Expert Group

The VAT Expert Group (VEG) has published the minutes of its 40th meeting of 27 June 2025, including challenges of VAT beyond ViDA, the platform economy, the single VAT registration, and the potential incentive mechanism for the Import One-Stop Shop (IOSS) scheme.

49th Meeting of the Group on the Future of VAT

The Group on the Future of VAT (GFV) has published the minutes of its 49th meeting of 24 June 2025, including an update on ViDA, e-invoicing, digital reporting, and enhancing the One-Stop Shop (OSS) and IOSS schemes.

Directive on Mandatory Import VAT Collection Adopted

The Council of the European Union adopted Directive (EU) 2025/1539 to encourage the use of the IOSS scheme. From 1 July 2028, suppliers or deemed suppliers will be primarily liable for collecting and remitting import VAT on eligible distance sales of imported goods (replacing the current situation where the customer is primarily liable on imports).

Non-EU suppliers or deemed suppliers not using the IOSS will generally be required to register for VAT and appoint a tax representative in each member state of final destination of the imported goods.