Comments on ECJ Case C-726/23 (Arcomet) – VAT for Transfer Price Adjustments in Arcomet Towercranes Case

• The Court of Justice of the European Union ruled on VAT taxation for transfer price adjustments between related entities in case C-726/23.
• The case involved Arcomet, a Romanian company, and its Belgian parent company, concerning support services and transfer pricing adjustments.
• Romanian tax authorities disputed VAT deductions on these adjustments, claiming they were unrelated to taxable activities.
• The Romanian company appealed, and the ECJ ruled that intra-group services linked to the subsidiary’s operating margin are taxable and subject to VAT.
• Transfer pricing adjustments should also be treated as taxable supplies subject to VAT.
• Tax authorities can request additional evidence to confirm services and their use for taxable transactions.
• Authorities cannot assess the economic usefulness of services for VAT deduction purposes.
• Each situation requires individual assessment of legal consequences for the taxpayer.

Source: itadp.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.

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