- The European Court of Justice (ECJ) has ruled that spa fees cannot be considered as payment for a taxable supply if the spa facilities can be used by anyone, resulting in the inability to deduct input VAT.
- However, on the positive side, spa fees will no longer be subject to VAT, saving municipalities 7%.
- The ECJ’s decision applies to a municipal statute in which a spa tax was charged to non-residents, but not to day visitors or residents, and the spa facilities were freely accessible to everyone.
- The ECJ concluded that there was no direct connection between the supply of services and the spa tax, and therefore no taxable supply for consideration.
- The judgment will not apply to all spa fees in Germany, as there may be cases where the facilities can only be used by those liable to pay spa fees, which would constitute a supply for consideration.
Source KMLZ
See also
- Summary of C-344/22 (Gemeinde A)– Access for free to spa facilities is not a taxable transaction if remuneration is a tourist tax
- ECJ C-344/22 (Gemeinde A)- Judgment – Access for free to spa facilities is not a taxable transaction if remuneration is a tourist tax
- Join the Linkedin Group on ECJ VAT Cases, click HERE
- For an overview of ECJ cases per article of the EU VAT Directive, click HERE
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