- The latest EU Court of Justice ruling is significant for local governments, transport companies, and passengers.
- Transport operators will benefit as they won’t have to pay VAT on compensations from municipalities and counties.
- Local governments can pay compensations in net amounts, saving money for public transport.
- Passengers may see improved public transport services due to savings on VAT.
- Expert Marcin Gromadzki expects savings to enhance service quality, such as more frequent routes or better buses.
- The EU court ruled that lump-sum compensations from municipalities to cover transport service losses are not subject to VAT.
- The issue involved compensations for private operators providing public transport services for local governments.
- The problem also affects municipal companies with full municipal ownership fulfilling local transport needs.
- Significant amounts are involved, with estimates of around half a billion zlotys in VAT for 2019-2024 from supported bus lines.
- Similar issues exist in municipal and non-commercial rail transport, potentially involving another half a billion zlotys annually.
- The problem arises because local councils set ticket prices that don’t overly burden passengers, leading to insufficient revenue for transport companies.
- Municipalities compensate operators based on specific legal provisions to cover operational costs.
Source: podatki.gazetaprawna.pl
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.
