- The Court of Justice of the European Union has ruled on the case of Cabot Plastic, which deals with the controversial issue of fixed establishments for VAT purposes.
- The case involves a reassessment against Cabot Plastic SA BELGIUM for an amount of 10 million EUR in VAT, 1 million EUR in fines, and late payment interest.
- The case revolves around whether a legally independent entity can form a fixed establishment of another taxable person.
- The tax authorities argued that Cabot Plastic Switzerland GmbH had a fixed establishment in Belgium and that the services provided by CPB (BE) should be subject to taxation in Belgium.
- The tax authorities presented several arguments to support their claim, including exclusivity, technical and human resources, and structure.
- The judgment is expected to put an end to the debates surrounding fixed establishments claims by tax authorities.
Source VATConsult
See also
- ECJ C-232/22 (Cabot Plastics Belgium) – Judgment – Toll manufacturing with ancillary services does not lead to Fixed Establishment
- Summary of ECJ-232/22 (Cabot) – No fixed establishment due to lack of human and technical resources even if ancillary services are performed, exclusivity
- Join the Linkedin Group on ECJ VAT Cases, click HERE
- For an overview of ECJ cases per article of the EU VAT Directive, click HERE
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