Customs and Tax Authority

Circular no. 35058, of February 25, 2016

Labelling obligations pursuant to Law no. 37/2007, of August 14

The PTA clarify some aspects pertaining the labelling obligations of tobacco products pursuant to Law no. 37/2007, of August 14, following the amendments introduced by Law no. 109/2015, of August 26.

According to this circular, the new brands of tobacco products subject to Tobacco Tax may be communicated to the PTA, until May 20, 2016, for the purposes of marketing authorization, complying with the labelling and packaging obligations pursuant to the original version of the Law no. 37/2007 or complying with the labelling and packaging obligations pursuant to the wording given by the Law no. 109/2015.

After that date, the new brands of tobacco subject to Tobacco Tax communicated to the PTA shall comply with the labelling and packaging obligations pursuant to the wording given by the Law no. 109/2015.

Concerning the tobacco products that already hold a marketing authorization, the circular settles that the products produced in national territory or imported until May 20, 2016, that have been labelled according to the original version of the Law no. 37/2007, may still be released for consumption and marketed after that date.

Yet the tobacco products produced or imported after May 20, 2016, may only be released for consumption if labelled according to the wording in force of that Law.

Hence, if the economic operators holding an authorization for marketing those products intend to continue to release them for consumption, they shall submit an application for the modification of the brands’ elements.

Customs and Tax Authority

Binding information concerning Case no. 9737, of January 22, 2016, published on February 16, 2016

VAT – Rates – Transfer of portable bath tub for people with reduced mobility or bedridden

In this binding information, the PTA set out the VAT framework for the onerous transfer of portable bath tubs for people with reduced mobility or bedridden.

Considering that this equipment does not meet the requirements of any paragraph of VAT annexes in respect of reduced and intermediate rates, the PTA conclude that the transfer of the portable bath tubs for people with reduced mobility or bedridden is subject to taxation at the normal rate (23%).

Customs and Tax Authority

Binding information concerning Case no. 205.20.10-160/2015, I.V. no. 10/2015, of January 22, 2016, published on February 5, 2016

Excise Duties – Rates – Exemption of excise duties on tobacco, alcohol and alcoholic beverages for products sold in duty free shops

In this binding information, the PTA give their binding opinion on the applicability of the exemption provided for under article 6-A of the Excise Duties Code, to the alcohol and tobacco purchased in a duty free shop, by a passenger travelling by sea towards a third country or territory.

Thus, the PTA state that the aforesaid exemption requires the products to be sold in duty free shops and transported in the passenger’s personal luggage, from one country to a third territory.

On the other hand, the PTA refer that, for the purposes of the exemption, the abovementioned territory shall necessarily be the passenger’s final destination and attested by a transport document mentioning a third country or territory’s airport or po rt as final destination.

At last, the PTA point out that the applicability of that exemption is subject to the quantitative limits pertaining the import of the goods transported in the luggage of those travelling from third countries or territories, as provisioned by article 116 of the Law no. 64-A/2008, of December 31.

Customs and Tax Authority

Binding information concerning Case no. 9652, of February 3, 2016, published on February 16, 2016

Rates – VAT – Location of operations – Provision of services of “jeep tours with driver” and “transfers from the airport to the hotel in the compan y’s own car”, operated in the Autonomous Regions

In this binding information, the PTA clarify that the provision of services of “jeep tours with driver”, as well as “transfers from the airport to the hotel in the company’s own car” , consisting of passenger transport activities, including vehicles hired with a driver, are subject to taxation at a reduced rate, as provisioned by the heading 2.14 of the List I annexed to the VAT Code.

Nevertheless, the PTA state that the aforesaid provision of services is subject to taxation at the reduced rate applicable in the autonomous regions and in mainland Portugal , according to territory in which the services are provisioned.

Customs and Tax Authority

Binding information concerning Case no. 9847, of January 26, 2016, published on February 16, 2016

VAT – Foundation – Ordering Contract through which the creator produces a work (the investigation project and associated reports) for a Foundation that will own the authors’ rights – Applicability of the exemption provided for under the article 9, paragraph 16, of the VAT Code

In this binding information, the PTA clarify the applicability of the VAT exemption pertaining the transfer of copyrights by the author, to the payments made under collaboration protocols established between a foundation that promotes studies and research projects and the researching entities.

In this case, the foundation had signed a contract with a researching entity, under which “the project is done by request and on account of the Foundation, this being the one and legitimate owner of the copyrights and other related intellectual property rights.”

According to the content of this clause and pursuant to the Copyright and Related Rights Code, the PTA explain that, in this case, one shall distinguish the concept of award of the copyrights from the concept of transfer of those rights, since only the transfer is covered by the exemption provided for under article 9, paragraph 16, of the VAT Code.

Thus, according to the PTA, in this particular contract, in which the parties stipulate that the copyrights will be originally awarded to the principal or employer, there is no transfer of the copyrights, but an awarding of that right to the principal or employer.

Therefore, the PTA conclude that the payments made to the contracted entities, for the production of investigation projects, are subject to VAT, since they constitute the quid pro quo of the original awarding of the copyrights, not being eligible as an exempt transfer pursuant to article 9, paragraph 16, of the VAT Code.