AG Opinion
A national adjustment regime for capital goods which provides that in the year in which the goods enter into use the total amount of the initial deduction may be adjusted in a single step if, upon entry into use, it turns out that that initial deduction deviates from the deduction to which the taxable person is entitled on the basis of the actual use of the capital goods, does not fall under Article 187 et seq. of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, but falls under Articles 184 to 186 of that directive. Those provisions do not oppose such a national adjustment regime.
Facts
- Foundation Schoonzicht has had an apartment complex built on its land, consisting of seven residential apartments.
- Construction commenced in 2013 and the complex was completed in July 2014.
- For VAT, this delivery constituted a supply of goods within the meaning of Article 3, paragraph 1, c of the Dutch VAT Act.
- With this provision, the Dutch legislator has made use of the option laid down in Article 14 (3) of the VAT Directive 2006 to consider the construction of certain immovable works as the delivery of goods.
- The VAT that was charged in the course of 2013 in connection with the construction of the complex was fully deducted as the property was meant to be used for VAT taxable activities.
- From 1 August 2014, however, four of the apartments have been leased with VAT exemption. The other three apartments were not used in 2014.
- Stichting Schoonzicht has reported output VAT to be attributed to these apartments, for the period in which the four apartments were taken into use (the third quarter of 2014). However, the foundation then appealed against this payment, arguing that for investment goods a revision of the entire deduction conflicts with the VAT directive.
- The Inspector disagrees.
- The Dutch Supreme Court reads article 187 of the VAT Directive in conjunction with Articles 184 to 186 and also feels that the Dutch revision rules are in line with these articles. However, it is not beyond any reasonable doubt that Articles 184 to 187 of the VAT Directive 2006 allow that during the first revision year all input VAT can initially be recovered. The Supreme Court therefore presents this issue to the Court of Justice.
Source Curia
