The correct VAT treatment of holding companies under the EU VAT system is a controversial and much debated topic. That treatment is often subject to litigation with the tax authorities.
The discussions mostly revolve around the entitlement of holding companies to deduct VAT on expenses incurred for the purposes of managing their subsidiaries.
The latest EU case deals with the situation of a holding which claimed VAT deduction for costs relating to the activities of its subsidiaries.
Source VATconsult
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