Prejudicial Questions on Directors’ Liability for VAT Debts in the Netherlands and the EU

• On October 6, 2023, a case involving director’s liability for VAT debts was brought before the court.
• Individual X was the director and sole shareholder of BV B, which in turn was the director and sole shareholder of BV A, involved in medicine delivery to pharmacists based on an agreement with BV D since 2014.
• BV B sold BV A’s shares to BV C on March 29, 2019, and E took over BV D’s transport network on July 31, 2017.
• BV A went bankrupt in 2020, and the tax authority held X liable for unpaid wage tax and VAT assessments, totaling €142,852.
• X appealed, but the lower court ruled in favor of the tax authority, later reducing the liability to €92,394.
• The Supreme Court disagreed with X’s argument and discussed the national and EU principles of proportionality.
• The Supreme Court posed two questions to the Court of Justice of the European Union regarding the compatibility of Article 36, paragraph 4, of the Dutch Tax Act with the EU principle of proportionality, focusing on VAT debts.
• The Supreme Court suspended the case pending the CJEU’s judgment.

Source: futd.nl

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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