- A Portuguese publisher of consumer protection magazines offered new subscribers a gift (a tablet or smartphone) as part of a promotional campaign.
- The gifts were bought from companies in the EU with acquisition tax recovered, and their unitary value was always below EUR 50.
- Following a tax inspection, the authorities considered the gifts to be disposed of free of charge and assessed the publisher accordingly, but the publisher appealed.
- The Court concluded that the provision of a subscription gift in return for taking out a subscription to magazines constitutes a supply that is ancillary to the principal service of supplying periodicals and is not a deemed supply on which VAT is due as a disposal of goods free of charge within the meaning of Article 16.
Source KPMG
See also
- ECJ C-505/22 (Deco Proteste – Editores, Lda) – Judgment – A gift for a subscription is not a free transfer of goods and is ”incidental service” to the main supply
- Summary of the ECJ Case C-505/22: A subscription gift in exchange for a periodical subscription is considered an ancillary supply
- Roadtrip through ECJ Cases – Focus on ”Free Products” (Art. 16)
- Join the Linkedin Group on ECJ VAT Cases, click HERE
- VATupdate.com – Your FREE source of information on ECJ VAT Cases
