ECJ C-60/23 (Digital Charging Solutions) – AG Opinion – VAT Treatment of Electricity Supply for EV Charging

On April 25, 2024, the ECJ issued the AG Opinion in the case C-60/23 (Digital Charging Solutions).

Context: Reference for a preliminary ruling – Taxation – Value added tax (VAT) – Directive 2006/112/EC – Articles 14, 15 and 24 – Recharging points for electric vehicles – Provision of devices for recharging electric vehicles, supply of the necessary electricity, and provision of technical support and IT services – Classification as a ‘supply of goods’ or a ‘supply of services’ – Article 14(1), Article 14(2)(c) and Article 28 – Nature and role of the device provider in that supply

Relevant articles in the EU VAT Directive 2006/112/EC

Articles 14, 15, 24 and 28 of the EU VAT Directive 2006/112/EC.

Article 14
1. ‘Supply of goods’ shall mean the transfer of the right to dispose of tangible property as owner.

Article 15
1. Electricity, gas, heat or cooling energy and the like shall be treated as tangible property.
2. Member States may regard the following as tangible property:
(a) certain interests in immovable property;
(b) rights in rem giving the holder thereof a right of use over immovable property;
(c) shares or interests equivalent to shares giving the holder thereof de jure or de facto rights of ownership or possession over immovable property or part thereof.

Article 24
1. ‘Supply of services’ shall mean any transaction which does not constitute a supply of goods.

Article 28
Where a taxable person acting in his own name but on behalf of another person takes part in a supply of services, he shall be deemed to have received and supplied those services himself.

Questions

Question 1: Does a supply consisting of charging an electric vehicle in a charging station to the user of the vehicle constitute a supply of a good under Articles 14(1) and 15(1) of the VAT Directive?

Question 2: If the answer to question 1 is yes, then such a delivery must be considered to exist at all stages of a transaction chain that includes an intermediate company where the transaction chain is accompanied by agreements at each stage, but only the user of the vehicle has circumstances such as quantity, time and place for charging and how the electricity will be used?

AG Opinion

Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax

must be interpreted as meaning that the recharging of an electric vehicle at a network of charging points to which a user has access by means of a subscription concluded with a company other than the charging-point operator implies that the electricity consumed is delivered from that operator to that user, and the company offering access to those charging points acts, in that supply, as a commissionaire within the meaning of Article 14(2)(c) of that directive.

Alternatively, if the two conditions of Article 14(2)(c) of Directive 2006/112 are not met, it should be considered that the supply of electricity to the user is deemed to be made by the company which provides access to a network of charging points to users within the meaning of Article 14(1) of that directive.

Summary

Article 15 of the VAT Directive states that electricity is considered a good for VAT purposes
The supply of electricity to a vehicle’s battery, along with access to charging devices and technical support, is considered a supply of goods under the VAT Directive
The analysis focuses on how the VAT Directive applies to each stage of the transaction involved in charging an EV using a card or app
DCS performs two different supplies: a supply of services (providing access to charging points) and a supply of goods (electricity)
Separate invoices for services and goods indicate distinct and independent transactions for VAT purposes
Access to the network is considered autonomous from the supply of electricity, leading to different VAT treatment for each aspect of the transaction.

Source