VATupdate

ECJ Case C-275/18 (Vins) – Questions – Sufficient evidence for zero-rate on export

On 8 June 2018, the ECJ has been asked preliminary questions in Case C-275/18 (Vins) regarding the question if the documents issued by the postal services are sufficient evidence for charging 0% VAT on export deliveries.

Note from the editors: This is an interesting case to follow, as on one hand, taxable persons should have the freedom and flexibility to obtain sufficient evidence for charging 0% VAT on the basis of ‘ books and records’, but on the other hand there is the new (proposed) rules set by the European Commission, in which a (limited?) list of documents is used for proving the VAT zero-rate.

Simplified facts:

  • Vins, a company established in Czech Republic, sold and delivered goods by post – especially military memorabilia, about 400 to 500 pieces per month, at prices varying between 100 and 400 Czech crown (CZK) each (between approx. 3.90 EUR and 15.60) – to third
    countries outside the European Union.
  • Vins argued that these goods were exported from the EU and charged 0% VAT.
  • The Czech tax authorities did not agree with this, as they were of the opinion that Vins did not have sufficient evidence of the export transactions in its VAT bookkeeping.
  • Vins claims that to fulfill the conditions of the VAT exemption for export does not require the goods to be placed under any of the customs procedures or that a customs document is necessary, but that is is sufficient to prove the export in another way, as long as it is clear that the goods have actually left the territory of the EU. According to Vins, documents issued by postal services which transport these goods to third countries ensured such proof.
  • The Czech Court also also considers that the export of goods can be substantiated by a different piece of evidence than a
    Customs declaration stating that the goods have been exported to a place outside the territory of the EU (referring also to ECJ Case C-563/12 (BDV Hungary Trading Kft.).
  • However, here the question arises whether the national legislator is allowed to require a taxable person to have specific evidence, such as that the goods are placed under one of the customs procedures, and not accepting any other evidence.

Preliminary questions:

May the right to an exemption from VAT on the export of goods (Article 146 of Council Directive 2006/112 / EC of 28 November 2006 on the common system of value added tax) be subject to the condition that the goods are previously placed under a special customs procedure?

Does the objective of preventing fraud, avoidance and abuse in Article 131 of the VAT Directive constitute a sufficient justification for such national legislation?

Source: MinBUZA (Dutch)