The Latvian Information and Communication Technology Association (C-87/23) – AGO – a non-profit association – engaged in supply, economic activity, and taxable amount – won the case. The association, established in 2016, was awarded contracts to implement two projects financed by EU funds. The Latvian Tax Authority challenged the association’s right to input VAT recovery. On appeal, three questions were referred to the European Court. The AG noted that the recipient of the service can be based on the person who paid for the service, and the flow of payments is only an indicator. The AG added that employing a subcontractor is entirely normal in the business world and involves the subcontractor providing a service to a client, which then provides said service to its customers as its own service.
Source KPMG
See also
- VATupdate.com – Your FREE source of information on ECJ VAT Cases
- Collection of Country VAT guides on VATupdate.com, click HERE
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