Article in the VAT Directive
Article 5(8) of Directive 77/388/EEC 1 and Article 19 of Directive 2006/112/EC
Article 19 (Taxable transaction/Transfer of Going Concern)
In the event of a transfer, whether for consideration or not or as a contribution to a company, of a totality of assets or part thereof, Member States may consider that no supply of goods has taken place and that the person to whom the goods are transferred is to be treated as the successor to the transferor.
Member States may, in cases where the recipient is not wholly liable to tax, take the measures necessary to prevent distortion of competition. They may also adopt any measures needed to prevent tax evasion or avoidance through the use of this Article.
Question
Do Article 5(8) of Directive 77/388/EEC 1 and Article 19 of Directive 2006/112/EC preclude national legislation such as Article 20 of Presidential Decree No 131 of 26 April 1986, as amended by points (1) and (2) of Article 1(87)(a) of Law No 205 of 27 December 2017 and by Article 1(1084) of Law No 145 of 30 December 2018, which requires that the tax authorities classify transactions between parties solely on the basis of the textual information contained in the relevant contract and prohibits the use of extrinsic (extratextual) information (even if it objectively exists and is proven), with the result that the tax authorities are absolutely precluded from proving that an economic supply, constituting a transfer of a business, which is in itself indissociable, has in reality been artificially broken down into a number of different supplies – multiple supplies of goods – and therefore gives rise to a right to deduct VAT where the requirements laid down by EU law are not met?
Source
