State grants for local public transport not subject to VAT, full input VAT deduction allowed.

Federal Fiscal Court ruled that state grants to local public transport are not subject to VAT
Municipality received grants for construction of landing stage for public ferry transport
District grant was subject to VAT, state grant was non-taxable
Municipality entitled to full input VAT deduction as taxable person
State allocation was for structural policy reasons, not remuneration for services
State grant was for general funding for transport infrastructure, not specific project
Tax office’s objection to state allocation being subject to VAT was rejected by Federal Fiscal Court

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.