ECJ Rules Against Application of Article 215 (4) Customs Code to Import VAT

• The ECJ ruled that Article 215(4) of the Customs Code does not automatically apply to the determination of import VAT if goods were brought into the EU in breach of customs rules and then transported to another Member State.
• The case involved the unlawful importation of cigarettes into the EU and the levying of VAT on them.
• The Hamburg Tax Court requested a preliminary ruling from the ECJ.
• The ECJ held that national legislation cannot apply Article 215(4) of the Customs Code to import VAT.
• Applying Article 215(4) to import VAT would result in revenue accruing to the Member State where the customs debt was found, which goes against the principle of territorial application of VAT.
• If the cigarettes were intended for consumption in Poland, the German authority would need to inform the Polish authority to avoid tax loss.

Source: blogs.pwc.de

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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