For our October summary of important VAT developments with implications for cross-border business operations, please click here. In this month’s update, key developments include:

  • Court of Justice of the European Union – where a VAT registration number has been deactivated, input VAT can still be deducted subsequently, when the number is reactivated and the substantive conditions for VAT recovery are met (Siemens Gamesa Renewable Energy România SRL v. Romania (C-69/17)); Services in helping with invoicing and collecting fees are taxable administration services, not financial services or debt collection (DPAS Ltd (C- 5/17))
  • Opinions of the Advocate General – whether a holding company that carries out an economic activity can deduct the input VAT charged on costs connected to an intended sale of shares which aborts (C&D Foods Acquisition ApS v. Skatteministeriet (C-502/17)); Two opinions concerning the Special Scheme for Travel Agents (TOMS) (Alpenchalets Resorts (C-552/17) and Skarpa Travel sp. z. o.o. w Krakowie (Skarpa))
  • EU Directive – New proposed directives to modernize VAT for the digital economy, reduce fraud and simply compliance

Country Specific:

  • Argentina: Argentina regulate the supply of VAT to the importation of “digital services”
  • GCC States: VAT implementation plan in Bahrain, Kuwait, Oman and Qatar. For further information on GCC VAT developments, please contact Ton van Doremalen
  • Luxembourg: Luxembourg-based entities who share organizational, economic or financial links are now entitled to establish a VAT group
  • United Kingdom: Anticipated impact of Brexit VAT; taxpayers who wish to appeal VAT assessment must pay the VAT upfront – EU principle of equivalence does not apply (Totel Limited [2018] UKSC 44)