The German court referred questions about the VAT exemption for private hospitals. Medical care is exempt from VAT in Germany only if it is provided under conditions equivalent to those of bodies governed by public law and if a significant proportion of patients are entitled to reimbursement of costs. X GmbH is not a body governed by public law and operates a hospital which has no agreements with health insurance funds. It considers itself to be equivalent. The German court referred questions to the European Court.
1. Is Paragraph 4, point 14(b), of the Umsatzsteuergesetz (Law on Turnover
Tax) (UStG) compatible with Article 132(1)(b) of Council Directive
2006/112/EC of 28 November 2006 on the common system of value added
tax (‘the VAT Directive’), in so far as hospitals which are not bodies
governed by public law qualify for exemption from tax on condition that
they are approved within the meaning of Paragraph 108 of the
Sozialgesetzbuch (SGB) V (Social Security Code, Book V)? [Or. 2]
2. If Question 1 is to be answered in the negative: When do hospitals
governed by private law provide hospital care under social conditions
comparable with those applicable to bodies governed by public law within
the meaning of Article 132(1)(b) of the VAT Directive?
II. The proceedings are staid until such time as the Court of Justice of the
European Union gives a ruling.