- In chain transactions with only one physical intra-EU shipment, the 0% VAT exemption can apply to only one supply in the chain, depending on which sale is linked to the transport.
- The decisive issue is when the right to dispose of the goods as owner passed, based on the economic and logistical reality, not merely formal legal title.
- In Case T-614/25 (Trading 4), Latvia argued that its sales to Estonian and UK intermediaries were domestic Latvian supplies, because those intermediaries resold the goods before transport and ownership allegedly passed in Latvia.
- The case also shows that moving goods under excise-duty suspension does not by itself entitle a supply to zero-rated VAT; excise and VAT rules are separate.
- The Latvian tax authority further alleged possible VAT fraud/evasion involvement and sought to require VAT registration in Latvia for the intermediaries.
Source: vatabout.com
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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