Back in 1858, Rudolf von Jhering, a well-known German legal scholar, said: ‘Form is the sworn enemy of arbitrariness, the twin sister of freedom’. Perhaps this is why Value Added Tax (VAT) law includes many formal requirements before the taxpayer can exercise his right of deduction or can opt for taxation, for example. Concerning these formal requirements, it is not disputed that the Court of Justice of the European Union (CJEU or Court of Justice) has put a stop to excessive formalism in VAT law. However, there are some interesting recent decisions of the Court of Justice, which were dealing with the question as to whether the lack of formal requirements allows the financial administration to deny the right of deduction or the right to opt for taxation, even if the material conditions are fulfilled. This article shows that there is a recent tendency in the jurisprudence of the CJEU to take more into account the function of formal conditions in the field of VAT law. It seems that the Court has found now a better balance between the rights of the taxable person and the principle of proportionality, on the one hand, and the principle of neutrality and the uniform and simple application of VAT law, on the other. VAT law, formal requirements, VAT identification number, Invoice, Registration as taxable person, formal and material conditions, sens of form, no right to deduction without an invoice, necessary content of an invoice
{"title":"Article: New Tendencies Regarding the Relevance of Formal Requirements in VAT Law","authors":"David Hummel","doi":"10.54648/ecta2023002","DOIUrl":"https://doi.org/10.54648/ecta2023002","url":null,"abstract":"Back in 1858, Rudolf von Jhering, a well-known German legal scholar, said: ‘Form is the sworn enemy of arbitrariness, the twin sister of freedom’. Perhaps this is why Value Added Tax (VAT) law includes many formal requirements before the taxpayer can exercise his right of deduction or can opt for taxation, for example. Concerning these formal requirements, it is not disputed that the Court of Justice of the European Union (CJEU or Court of Justice) has put a stop to excessive formalism in VAT law. However, there are some interesting recent decisions of the Court of Justice, which were dealing with the question as to whether the lack of formal requirements allows the financial administration to deny the right of deduction or the right to opt for taxation, even if the material conditions are fulfilled. This article shows that there is a recent tendency in the jurisprudence of the CJEU to take more into account the function of formal conditions in the field of VAT law. It seems that the Court has found now a better balance between the rights of the taxable person and the principle of proportionality, on the one hand, and the principle of neutrality and the uniform and simple application of VAT law, on the other.\u0000VAT law, formal requirements, VAT identification number, Invoice, Registration as taxable person, formal and material conditions, sens of form, no right to deduction without an invoice, necessary content of an invoice","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.6,"publicationDate":"2023-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"41420674","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Editorial: Pillar 2, Fiat, and the EU Unanimity Rule on Tax Matters","authors":"R. de la Feria","doi":"10.54648/ecta2023001","DOIUrl":"https://doi.org/10.54648/ecta2023001","url":null,"abstract":"","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.6,"publicationDate":"2023-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48075163","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Article: The EU VAT Rate Reform 2022 from an Environmental Policy Perspective","authors":"Stefanie Geringer","doi":"10.54648/ecta2023003","DOIUrl":"https://doi.org/10.54648/ecta2023003","url":null,"abstract":"","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135470661","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
After the recent agreements at a global level, some Member States of the European Union have paused their plans for Digital Services Taxes. However, others have decided to move forward with them as the global political agreement reached, while encouraging, has not been implemented yet. Therefore, it is still relevant to understand the nature of such taxes and, more importantly in the context of the EU, their possible (in)compatibility with state aid rules. The purpose of this article is to shed light into these measures in a manner that encompasses all possible taxes. To establish the possible incompatibility of the taxes, an analysis is made passing through all the conditions for a measure to be considered as state aid and giving particular importance to the notion of selective advantage, which will be the determining factor if the Court of Justice of the European Union (CJEU) ever must pronounce itself on this matter. Digital Services Taxes, State aid, Fiscal State aid, Selective Advantage, European Union, European Commission, Court of Justice of the European Union, Unilateral measures, OECD
{"title":"Article: Analysis of the (In)compatibility of Digital Services Taxes With State Aid Rules","authors":"María Carro Pitarch","doi":"10.54648/ecta2022031","DOIUrl":"https://doi.org/10.54648/ecta2022031","url":null,"abstract":"After the recent agreements at a global level, some Member States of the European Union have paused their plans for Digital Services Taxes. However, others have decided to move forward with them as the global political agreement reached, while encouraging, has not been implemented yet. Therefore, it is still relevant to understand the nature of such taxes and, more importantly in the context of the EU, their possible (in)compatibility with state aid rules.\u0000The purpose of this article is to shed light into these measures in a manner that encompasses all possible taxes. To establish the possible incompatibility of the taxes, an analysis is made passing through all the conditions for a measure to be considered as state aid and giving particular importance to the notion of selective advantage, which will be the determining factor if the Court of Justice of the European Union (CJEU) ever must pronounce itself on this matter.\u0000Digital Services Taxes, State aid, Fiscal State aid, Selective Advantage, European Union, European Commission, Court of Justice of the European Union, Unilateral measures, OECD","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.6,"publicationDate":"2022-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46473381","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The last few years have seen an increasing cooperation between tax authorities of Member States of the European Union by way of joint audits. This article shows how joint audits can provide an efficient solution to double taxation issues faced by internationally active companies. It centres on ways to amend and effectuate existing procedures of international tax law in light of experiences made with joint audits, focusing in particular on potential ways for more cross-border tax certainty. Furthermore, the article illustrates that an effective und legally certain reduction of international double taxation can best be reached by a stronger cooperation of tax authorities and the taxpayer/s. Finally, the author takes a look at recent developments in the field as well as the potential future of joint audits, emphasizing the need for more legally binding solutions. joint audit; joint tax audit; mutual agreement procedure; advance pricing agreement; tax certainty; cross-border tax certainty; dispute prevention; double taxation; transfer pricing; administrative cooperation
{"title":"Article: Reaching Cross-Border Tax Certainty With Joint Audits","authors":"Isabella Zimmerl","doi":"10.54648/ecta2022029","DOIUrl":"https://doi.org/10.54648/ecta2022029","url":null,"abstract":"The last few years have seen an increasing cooperation between tax authorities of Member States of the European Union by way of joint audits. This article shows how joint audits can provide an efficient solution to double taxation issues faced by internationally active companies. It centres on ways to amend and effectuate existing procedures of international tax law in light of experiences made with joint audits, focusing in particular on potential ways for more cross-border tax certainty. Furthermore, the article illustrates that an effective und legally certain reduction of international double taxation can best be reached by a stronger cooperation of tax authorities and the taxpayer/s. Finally, the author takes a look at recent developments in the field as well as the potential future of joint audits, emphasizing the need for more legally binding solutions.\u0000joint audit; joint tax audit; mutual agreement procedure; advance pricing agreement; tax certainty; cross-border tax certainty; dispute prevention; double taxation; transfer pricing; administrative cooperation","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.6,"publicationDate":"2022-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48514002","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The discussion about the tax consequences of a repayment of capital contributions made by corporations has been going on for years in Germany. Today, the issue has been defused, but uncertainties remain for non-EU corporations that make payments to their German shareholders.
{"title":"Forum: Repayment of Capital: A Real Evergreen Under German and EU Tax Law","authors":"Florian Haase","doi":"10.54648/ecta2022032","DOIUrl":"https://doi.org/10.54648/ecta2022032","url":null,"abstract":"The discussion about the tax consequences of a repayment of capital contributions made by corporations has been going on for years in Germany. Today, the issue has been defused, but uncertainties remain for non-EU corporations that make payments to their German shareholders.","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.6,"publicationDate":"2022-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47908177","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Editorial: Fiscal Federalism in the EU. A Dynamic Process With Multiple Dimensions","authors":"Bruno Peeters","doi":"10.54648/ecta2022028","DOIUrl":"https://doi.org/10.54648/ecta2022028","url":null,"abstract":"","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.6,"publicationDate":"2022-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44381345","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Exercising rights under EU Value Added Tax (‘VAT’) law (for example recovering input tax) is often subject to certain conditions. A distinction however exists between substantive and formal requirements: Non-fulfilment of the latter does not need to be fatal for a taxpayer’s claim. That being the case, the question arises how a condition can be classified as either ‘substantive’ or ‘formal’. The author summarizes the case law of the Court of Justice of the European Union (‘CJEU’) in the area and notes that the Court has so far refrained from providing an all-encompassing test. The article therefore explores whether a golden thread can be identified and analyses if the Court may have had a general principle in mind when labelling conditions as ‘formal’ in judicial precedent. VAT, CJEU, substantive, formal, invoice, intra-Community supply
{"title":"Forum Contributions: CJEU Case Law on Exercising Rights Under EU VAT: Is There a Golden Thread in the Distinction Between Substantive and Formal Conditions?","authors":"Fabian Barth","doi":"10.54648/ecta2022033","DOIUrl":"https://doi.org/10.54648/ecta2022033","url":null,"abstract":"Exercising rights under EU Value Added Tax (‘VAT’) law (for example recovering input tax) is often subject to certain conditions. A distinction however exists between substantive and formal requirements: Non-fulfilment of the latter does not need to be fatal for a taxpayer’s claim. That being the case, the question arises how a condition can be classified as either ‘substantive’ or ‘formal’. The author summarizes the case law of the Court of Justice of the European Union (‘CJEU’) in the area and notes that the Court has so far refrained from providing an all-encompassing test. The article therefore explores whether a golden thread can be identified and analyses if the Court may have had a general principle in mind when labelling conditions as ‘formal’ in judicial precedent.\u0000VAT, CJEU, substantive, formal, invoice, intra-Community supply","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.6,"publicationDate":"2022-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47471989","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
One way to solve classification conflicts involving hybrid entities is for states to apply a so-called symmetrical classification method, whereby a state adopts for its domestic tax purposes the tax classification applied to an entity by another state. The outcome of applying such a method can be that a state classifies foreign entities differently from domestic entities, raising potential issues from an EU law perspective when EU Member States are involved. For instance, in case a cross-border situation leads to more burdensome taxation compared to the domestic situation, a violation of the EU fundamental freedoms can be present, whereas if the classification leads to a lower tax burden for certain enterprises, a violation of EU State aid rules can be the result. In this article, we assess the conformity with primary EU law of tax classification methods, and especially of the symmetrical classification method. It is concluded that the risk of incompatibility with the EU fundamental freedoms and EU State aid rules should typically be limited when EU Member States align their tax classification rules with those of other states to alleviate risks of double (non-)taxation. Risks can increase, however, for instance if nationality is used as a distinguishing criterion, or where under- or overkill occurs. Taxation, Hybrid Entities, Mismatches, Classification, Symmetrical Method, EU Law, Fundamental Freedoms, State Aid
{"title":"Article: Is the Symmetrical Classification Method EU Proof?","authors":"T. Stevens, Mart van Hulten","doi":"10.54648/ecta2022030","DOIUrl":"https://doi.org/10.54648/ecta2022030","url":null,"abstract":"One way to solve classification conflicts involving hybrid entities is for states to apply a so-called symmetrical classification method, whereby a state adopts for its domestic tax purposes the tax classification applied to an entity by another state. The outcome of applying such a method can be that a state classifies foreign entities differently from domestic entities, raising potential issues from an EU law perspective when EU Member States are involved. For instance, in case a cross-border situation leads to more burdensome taxation compared to the domestic situation, a violation of the EU fundamental freedoms can be present, whereas if the classification leads to a lower tax burden for certain enterprises, a violation of EU State aid rules can be the result.\u0000In this article, we assess the conformity with primary EU law of tax classification methods, and especially of the symmetrical classification method. It is concluded that the risk of incompatibility with the EU fundamental freedoms and EU State aid rules should typically be limited when EU Member States align their tax classification rules with those of other states to alleviate risks of double (non-)taxation. Risks can increase, however, for instance if nationality is used as a distinguishing criterion, or where under- or overkill occurs.\u0000Taxation, Hybrid Entities, Mismatches, Classification, Symmetrical Method, EU Law, Fundamental Freedoms, State Aid","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.6,"publicationDate":"2022-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46912123","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Relations between Switzerland and the European Union (EU) have been shaped by various (bilateral) agreements. This contribution discusses one of the most important agreements between Switzerland and the EU; the agreement on the free movement of persons (AFMP). The AFMP does not have its own dispute settlement mechanism or supervisory body. Dispute resolution is now left to independent Swiss courts and the Court of Justice of the European Union (ECJ). On 23 November 2018, a first draft of an institutional framework agreement between Switzerland and the EU was published. The aim of this proposed framework agreement was partly to simplify the complex relations between Switzerland and the EU. In May 2021 the Swiss government pulled the plug on the institutional framework agreement because of concerns about migration, labour rights, and worries about the judicial authority the institutional agreement would give to the ECJ. The EC is however clear about what it wants. Amongst others, the dynamic alignment of Swiss law to EU law and a functioning dispute settlement mechanism are issues the EC wants to see solved. In this article the author explores, among other things, what the consequences could be for Swiss fiscal autonomy if Switzerland would follow the EC. The author also reflects in more detail on the ECJ’s case law on frontier workers and the final settlement on capital gains from shareholdings upon emigration to Switzerland. Free movement of persons, Switzerland, taxation, bilateral agreements, Wächtler judgment.
{"title":"Article: Free Movement of Persons Between the EU and Switzerland: Quo Vadis?","authors":"E. Ros","doi":"10.54648/ecta2022023","DOIUrl":"https://doi.org/10.54648/ecta2022023","url":null,"abstract":"Relations between Switzerland and the European Union (EU) have been shaped by various (bilateral) agreements. This contribution discusses one of the most important agreements between Switzerland and the EU; the agreement on the free movement of persons (AFMP). The AFMP does not have its own dispute settlement mechanism or supervisory body. Dispute resolution is now left to independent Swiss courts and the Court of Justice of the European Union (ECJ). On 23 November 2018, a first draft of an institutional framework agreement between Switzerland and the EU was published. The aim of this proposed framework agreement was partly to simplify the complex relations between Switzerland and the EU. In May 2021 the Swiss government pulled the plug on the institutional framework agreement because of concerns about migration, labour rights, and worries about the judicial authority the institutional agreement would give to the ECJ. The EC is however clear about what it wants. Amongst others, the dynamic alignment of Swiss law to EU law and a functioning dispute settlement mechanism are issues the EC wants to see solved. In this article the author explores, among other things, what the consequences could be for Swiss fiscal autonomy if Switzerland would follow the EC. The author also reflects in more detail on the ECJ’s case law on frontier workers and the final settlement on capital gains from shareholdings upon emigration to Switzerland.\u0000Free movement of persons, Switzerland, taxation, bilateral agreements, Wächtler judgment.","PeriodicalId":43686,"journal":{"name":"EC Tax Review","volume":null,"pages":null},"PeriodicalIF":0.6,"publicationDate":"2022-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49291359","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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