For many years, tax authorities have rejected holding companies’ right to deduct input value added tax (VAT); however, the European Court of Justice (ECJ) has issued several decisions that have enabled a slow but unequivocal paradigm shift towards so-called ‘active’ or ‘mixed’ holdings (ie, holding companies which are directly or indirectly involved in the management of subsidiaries and provide them with taxable services).
Source International Law Office
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