A draft amendment to the Sales Registration Act has been submitted to the President of the Czech Republic for signature. The General Financial Directorate has published new information on the application of VAT on the free supply of goods. And the General Court of the EU assessed the question of whether a tax representative may be obliged to pay the VAT due for the represented taxable person. We bring you more news from the world of indirect taxes in the article.
Activities of the tax administration
The draft amendment to the Sales Registration Act (Parliamentary Document 189) has been moved to the final stage of the legislative process and was forwarded to the President of the Czech Republic for signature on 11 September 2026. At this stage of the legislative process, there have been no changes to the amendment to the VAT Act. The proposal, effective from 1 January 2027, continues to envisage in particular changes to the limits for corrections of the tax base for bad debts, an adjustment of the deadline for the correction of the debtor’s tax deduction and the extension of the reduced VAT rate to the serving of all non-alcoholic beverages as part of catering services.
The General Financial Directorate has published new information on the application of VAT to the gratuitous supply of goods. The information is applicable from 1 July 2026 and replaces the current valid information issued in 2023. Its main purpose is to update and clarify the current methodological approach of the Financial Administration, and from our point of view, this new information does not bring any substantive changes or a new interpretation of the rules for the application of VAT to gratuitous supplies of goods.
CJEU case law
- In Case C-184/25 Veronsaajien oikeudenvalvontayksikkö, the General Court dealt with the exemption of credit administration under Article 135(1)(b) of the VAT Directive (in the Czech context, Section 54(2) of the VAT Directive). In the dispute, company A granted the loan, but subsequently transferred all rights and obligations under the loan agreement to company B. Nevertheless, it continued to administer the loan to company B and invoiced the borrower for the management fees on behalf of B. The General Court concluded that the credit servicing exemption applies only to the administration carried out in the context of the original credit relationship between the creditor and the borrower. Therefore, the credit servicing provided by company A after the transfer of the loan is subject to VAT.
- In Case T-356/25 Rapera, the General Court considered the question whether a tax representative could be liable to pay the VAT due on behalf of the taxable person represented. In the present case, the tax representative submitted a VAT return for an Italian company and ensured the payment of taxes without being involved in its business activities. The General Court confirmed that Member States may also appoint a tax representative for the payment of VAT by the person liable, even if he is not involved in the transactions carried out. At the same time, however, it emphasised that the tax representative cannot be required to pay the VAT due if, even with due diligence, he could not have been aware of the transactions carried out by the represented person.
- In Case T-268/25 Sampension Livsforsikring A/S, the General Court dealt with the conditions for the creation of VAT groups in Denmark. It found that Member States may take measures against tax evasion and abuse, but these measures must be proportionate, and the mere use of the VAT group scheme cannot be considered as tax evasion or abuse of law. It pointed out that the condition of 100% ownership links set in Denmark may not be compatible with EU law in all circumstances. The General Court left it to the national court to assess the specific situation.
- In its judgment T-413/25 Peckeger, the General Court dealt with a situation in which an Austrian entrepreneur invested taxable leased real estate in an already existing company in which he was the sole shareholder. The tax administrator argued that this was a taxable transaction on the grounds that the Austrian legislation excluded the application of the business transfer regime (TOGC) to leased property. The CJEU confirmed that Member States cannot limit the use of TOGC only to undertakings generating certain types of income. At the same time, it stated that the contribution of real estate without the acquisition of new shares does not constitute a supply of goods for consideration. Therefore, if the TOGC conditions were not met, it would be necessary to assess the application of the rules for taxation of the gratuitous provision of property.
- In its judgment in Case T-614/25 AS “Trading 4”, the General Court ruled on the allocation of transport when goods are supplied to another EU Member State under the excise duty suspension scheme. The General Court concluded that the time of the transfer of ownership, the fact that the goods were transported under the excise duty suspension scheme and the subsequent payment of VAT in the Member State of destination are not decisive for that assessment. According to the General Court, the national court must assess, in particular, whether the intermediate party has transferred to the final customer the right to dispose of the goods as owner while still in the State of dispatch. In that context, it is also necessary to take into account the involvement of the final customer in the organisation of the transport.
