Roadtrip through ECJ Cases – Focus on the Exemption for Intra-Community supplies of goods (Art. 138)

Last update: July 16, 2025

Importance of Article 138 of the EU VAT Directive 2006/112/EC:

Exemption for Intra-Community Supplies: Article 138 exempts supplies of goods transported between EU Member States from VAT, facilitating seamless trade and preventing multiple tax charges on intra-Community transactions.
Promoting Internal Market Efficiency: This exemption reduces administrative burdens for businesses, encouraging cross-border trade and fostering a more integrated internal market within the EU.
Alignment with the Destination Principle: Article 138 supports the destination principle of VAT, ensuring that tax revenues are allocated to the Member State where goods are consumed, promoting fair tax distribution among EU countries.

Article in the EU VAT Directive 2006/112/EC

Article 138

1. Member States shall exempt the supply of goods dispatched or transported to a destination outside their respective territory but within the Community, by or on behalf of the vendor or the person acquiring the goods, for another taxable person, or for a non-taxable legal person acting as such in a Member State other than that in which dispatch or transport of the goods began.
2. In addition to the supply of goods referred to in paragraph 1, Member States shall exempt the following transactions:

(a) the supply of new means of transport, dispatched or transported to the customer at a destination outside their respective territory but within the Community, by or on behalf of the vendor or the customer, for taxable persons, or non-taxable legal persons, whose intra-Community acquisitions of goods are not subject to VAT pursuant to Article 3(1), or for any other non-taxable person;
(b) the supply of products subject to excise duty, dispatched or transported to a destination outside their respective territory but within the Community, to the customer, by or on behalf of the vendor or the customer, for taxable persons, or non-taxable legal persons, whose intra-Community acquisitions of goods other
than products subject to excise duty are not subject to VAT pursuant to Article 3(1), where those products have been dispatched or transported in accordance with Article 7(4) and (5) or Article 16 of Directive 92/12/EEC
(c) the supply of goods, consisting in a transfer to another Member State, which would have been entitled to exemption under paragraph 1 and points (a)>and (b) if it had been made on behalf of another taxable person.

ECJ Cases Decided