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germany

Deposit charged on issuance of electronic payment card is vatable supply of services

Germany’s Federal Fiscal Court (BFH) has ruled that a deposit charged for the issuance of an electronic payment card to be used to make cashless payments for food and drink in football stadia is not lump sum compensation (conditional on the return of the card). Rather, the charge and collection of the deposit represents a taxable supply of services for VAT purposes that qualifies as a VAT exempt payment transaction if the taxable person providing the service also carries out the transfer of funds. The BFH’s decision in case XI R 19/19 was issued on 26 January 2022 and published on 9 June 2022.

Source: Deloitte

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