- CJEU held that an introductory gift for a magazine subscription does not constitute a separate supply subject to VAT
- Case involved a publisher in Portugal offering a tablet or smartphone as an introductory gift to new subscribers
- Publisher did not charge extra for the gift and subscribers could keep it even if they cancelled the subscription
- Portuguese tax authority argued that the gift should be subject to VAT
- CJEU found that the gift is an integral part of the publisher’s commercial strategy and does not have a distinct purpose from the customer’s perspective
- Therefore, no separate supply is made and the publisher only has to pay VAT on the subscription, not the gift.
Source: kpmg.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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