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The Compatibility of Late Payment Interest on VAT with Union Law

  • The question of whether the imposition of late payment interest on value added tax (VAT) is in line with EU law is controversial and debated in the literature.
  • The issue of the compatibility of late payment interest with EU law was recently addressed by the Saarland Fiscal Court, following a similar case in the Düsseldorf Fiscal Court.
  • The Saarland Fiscal Court concluded that the provisions on the imposition of late payment interest on VAT do not violate EU law.
  • The court found that the national law does not violate the principles of neutrality, proportionality, equivalence, and effectiveness.
  • The case involved a GmbH that was subject to a tax investigation by the tax authorities.


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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