Comments on ECJ C-606/22: Unjust Enrichment and VAT Refunds: A Complex and Misunderstood Issue

• Tax authorities can deny a refund of overpaid VAT on the ground of unjust enrichment.
• Under EU law, the issue is complex and has been misunderstood by tax officers, legal advisors, and courts.
• However, it has been authoritatively stated that unjust enrichment in a B2C scenario is virtually impossible.
• This is because the supplier will always suffer, either by losing sales if they increase prices to account for higher VAT, or by losing profits if they cannot increase prices.
• The only exception is if all suppliers of a product with inelastic demand make the same mistake, which is very rare in practice.

Source Fabian Barth

See also

• C-606/22 (Dyrektor Izby Administracji Skarbowej w Bydgoszczy ) – Judgment – VAT due can be adjusted if excessive VAT Rates are applied

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