CJEU Rules Austria’s Financial VAT Exemption Illegal State Aid

The CJEU ruled in Case C-360/25 that Austria’s VAT exemption for certain financial-sector services is illegal State aid under Article 107(1) TFEU.
It found the exemption used state resources, gave a selective advantage, and could distort competition and trade in EU financial markets.
The court said the exemption was not justified by the EU VAT system’s nature or structure.
It refused to limit the ruling’s effect in time, so open tax periods may be reassessed.
The decision is a warning to other EU states that sector-specific VAT exemptions beyond the harmonized EU framework can be unlawful State aid.

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.