Advocate General Ettema concludes that the Netherlands can not exclude taxpayers who also perform non-economic activities from a VAT group (f.e.). The Netherlands has not determined that taxpayers who perform both economic and non-economic activities of joining an f.e. be excluded. Foundation A operates a number of schools. For the cleaning of the schools, A will start an external cleaning company until the beginning of 2009. However, A wants to carry out the cleaning in-house, and sets up the interested party, X bv, for that purpose. A and X, for example, form an f.e. for VAT. A then switches on Z, for example, to supervise the cleaning work. At the end of 2012, the inspector will inform X bv that the f.e. will end on 1 January 2013. According to the inspector, A is actually a consumer of cleaning services that are provided under the control and control of Z bv via X bv, for example. Court of The Hague judges that there is a link in financial, organizational and economic terms, so that there is an f.e. for VAT. Court The Hague also ruled that X bv and foundation A had an f.e. for the VAT. The court considers that the control of A over X bv is not affected by the agreements made with Z bv. In addition to the financial and organizational interwovenness, according to the Court of Appeal, there is also an economic interrelationship, because X, for example, only performs services to A. The court confirms the court’s decision. The state secretary and X bv file an appeal.
Advocate General Ettema concludes that the Netherlands can not exclude taxpayers who also perform non-economic activities from a f.e. The A-G points out that the Netherlands in art. 7 paragraph of the Wet OB 1968 has not stipulated that taxpayers who perform both economic and non-economic activities of joining a tax entity are excluded. It is therefore not allowed to do this via the link between economic interdependence. The A-G advises the Supreme Court to dismiss the appeal of the State Secretary as unfounded. The same fate affects X’s claim, for example, that it is entitled to reimbursement of the actual costs of the proceedings.
Source: taxlive.nl (Dutch)