On October 21, 2021, the ECJ issued its decison in the case C-583/20 (EuroChem Agro Hungary).
Context: Reference for a preliminary ruling — Article 53(2) and Article 99 of the Rules of Procedure of the Court — Common system of value added tax (VAT) — Directive 2006/112/EC — Article 273 — Fight against fraud — Obligation to declaration relating to the transport of goods – Electronic system of control of road freight – System of penalties applicable to taxpayers at risk – Proportionality
Article in the EU VAT Directive
Article 273 of the EU VAT Directive 2006/112/EC.
Article 273 (Miscellaneous provisions)
Member States may impose other obligations which they deem necessary to ensure the correct collection of VAT and to prevent evasion, subject to the requirement of equal treatment as between domestic transactions and transactions carried out between Member States by taxable persons and provided that such obligations do not, in trade between Member States, give rise to formalities connected with the crossing of frontiers.
The option under the first paragraph may not be relied upon in order to impose additional invoicing obligations over and above those laid down in Chapter 3.
Questions
Must Article 273 of the VAT Directive be interpreted as meaning that a penalty regime under which taxpayers classified as high-risk taxpayers who commit a minor infringement of the Elektronikus Közúti Áruforgalom Ellenőrző Rendszer (EKAER) (Road freight electronic monitoring system) may not be fined less than 30% of 40% of the value of the transported goods and which does not allow for the fine to be waived exceeds the limits of the power conferred on Member States by that article?
Must Article 273 of the VAT Directive be interpreted as meaning that a penalty of the abovementioned amount goes (disproportionately) beyond what is necessary to achieve the objective of collecting VAT and preventing evasion established in that article?
Must Article 26(2) of the Treaty on the Functioning of the European Union (TFEU) be interpreted as meaning that the penalty regime applicable to high-risk taxpayers is an obstacle to achieving the principle of free movement of goods, persons, services and capital?
AG Opinion
None
Decision (Order)
Article 273 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax and the principle of proportionality must be interpreted as precluding a national legislation which imposes on a taxable person qualified as a “taxpayer at risk”, within the meaning of national law, a fine intended to penalize irregularities committed in declarations of dispatch of goods, the amount of which cannot under any circumstances be less than 30% of 40% of the value of the goods.
Source
