- No VAT Deduction Allowed: X BV cannot deduct VAT on waste processing costs because it was not the direct customer; the legal relationship existed between the Municipal Executive and the service provider.
- Cost Recovery Doesn’t Equal Contractual Link: Although X BV reimbursed the municipality for the service, this reimbursement does not establish a VAT-relevant customer relationship under Dutch tax law.
- Court Confirms Independent Action: The Zeeland-West-Brabant District Court ruled that the municipality acted independently and not on behalf of X BV, rejecting the appeal and confirming the inspector’s denial of the VAT deduction.
Source Taxlive
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