Source Curia
Judgment of 21 February 2018 in Case C‑628/16 (Kreuzmayr GmbH)
Decision
1. In circumstances such as those in the main proceedings, the first paragraph of Article 32 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax must be interpreted as meaning that it applies to the second of two successive supplies of the same goods which gave rise to only one intra-Community transport.
2. Where the second supply in a chain of two successive supplies involving a single intra-Community transport is an intra-Community supply, the principle of the protection of legitimate expectations must be interpreted as meaning that the person ultimately acquiring the goods, who wrongly claimed a right to deduct input value added tax, may not deduct, as input value added tax, the value added tax paid to the supplier solely on the basis of the invoices provided by the intermediary operator which incorrectly classified its supply.
Facts:
BP Marketing GmbH (DE) sold petroleum products to BIDI Ltd (AT VAT ID #). BIDI agreed to order and arrange the transport of those products from DE to AT. Without informing BP Marketing, BIDI resold the goods to Kreuzmayr, agreeing that Kreuzmayr would order/arrange the transport of the goods from DE to AT, which Kreuzmayr did.
BP Marketing treated its supplies to BIDI as intra-Community supplies. BIDI treated its supplies to Kreuzmayr as local sales in AT, charging AT VAT, which VAT Kreuzmayr subsequently recovered.
When BP Marketing found out that BIDI had resold the products, and did, in fact, not transport the goods, BP Marketing reissued its invoices to BIDI, charging DE VAT. BIDI sent amended invoices to Kreuzmayr without VAT. However, BIDI did not repay the wrongly charged AT VAT to Kreuzmayr. BIDI went bankrupt, and Kreuzmayr never recovered the amounts of VAT which it had paid to BIDI.
The AT tax authorities raised an assessment with Kreuzmayr, arguing that the VAT on the original invoices from BIDI was wrongly charged, and was thus not deductible.
The ECJ repeats that there can be only 1 Intra-Community supply, which is the chain in which the transportation takes place. This is the transaction where the right to dispose of the goods as owner takes place.
In this case, Kreuzmayr was the owner of the goods before the intra-Community transport took place. This means that the intra-Community transport must be ascribed to the second supply.
Kreuzmayr could/should also have known or realized this, and can therefore not claim back any (wrongly) charged VAT.
Source: Curia
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