VAT News – May Edition

What tax treatment will be applied to meal vouchers? And on what tax-related cases has the Court of Justice of the European Union recently issued its rulings? Read the article to find the answers to these questions.

VAT Treatment of Issuing and Distributing Meal Vouchers and Similar Means of Payment

 Following a debate of the Coordination Committee between the Czech Chamber of Tax Advisors and the General Financial Directorate, it is evident that the tax administration applies the tax regime for vouchers pursuant to Section 15 and 15a of the VAT Act, as amended, to meal vouchers and similar payment vouchers. Although the debate has yet to be concluded, there is general agreement that the circulation of meal vouchers in the form of single-purpose vouchers will be subject to VAT, and the same rate will also have to be applied to the commission for their distribution. In contrast, the circulation of vouchers in the form of multi-purpose vouchers will not be subject to VAT, and supplies provided in this context to the issuer of meal vouchers should have the nature of administrative or mediation activities and should be subject to a 21% VAT rate. The conclusions of the Coordination Committee will be available in late June 2019.


 CJEU Case Law

 C-224/18 Budimex

In this ruling, the Court of Justice of the European Union (the “CJEU”) expressed the idea that the moment when construction services are subject to taxation may not occur if the resulting work has yet to be duly taken over by the customer, provided the final amount of the payment is not yet known prior to the take-over. The CJEU’s argumentation could be useful in cases where the date of taxable supply is generally determined in respect of the provision of services or supplies of goods.

C-672/17 Tratave, C- 127/18 A-PACK

 In two independent rulings, the CJEU described additional aspects of the possibility/obligation to correct tax in respect of irrecoverable receivables. On the one hand, the CJEU indirectly confirmed that the obligation of delivering a corrective tax document to the debtor under the Czech VAT Act does not, in principle, depart from the options stipulated by the EU’s VAT Directive applicable to member states, while, on the other hand, it regarded one of the other conditions stipulated by the Czech VAT Act to be in contradiction with EU law. Specifically, it ruled that the Czech VAT Act is not compliant with the Directive, given that it conditions the correction of the tax base and VAT under Section 44 of the VAT Act by the fact that the debtor has not stopped being a VAT payer. We believe that the CJEU’s deliberation should also be valid considering the new provisions of Section 46 et seq. of the VAT Act effective since 1 April 2019.

C‑235/18 Vega International Car Transport and Logistic – Trading GmbH

In the ruling, the CJEU described the context of suppling goods from the VAT perspective. A holder of a fuel card, which is used for paying for fuel, lent the card to another person and rebilled the fuel to the person. The CJEU highlighted that the supply of goods is not performed between the fuel distributor and the fuel card holder, but directly between the fuel distributor and the person that used it in fuelling up. The question is whether the CJEU’s perspective is, indeed, applied in practice.

The article is part of dReport – May 2019, Tax news; Grants and investment Incentives.

CJEU VAT dReport newsletter

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