The Court of Justice of the European Union has issued a favorable judgment for Polish entrepreneurs in a case concerning the assessment of the obligation to pay VAT in advance on intra-Community purchases of fuel. The proceedings were conducted pursuant to a request for a preliminary ruling submitted by the Supreme Administrative Court in connection with a dispute between G. sp. z o. o. and the Director of the Fiscal Administration Chamber in Bydgoszcz. The proceedings were based on the following factual circumstances.
In December 2016, G. sp. z o. o. made 20 intra-Community acquisitions of diesel fuel falling within CN code 2710 19 43. The tax authority found that the acquisitions made by the Company fell within the second case provided for in Article 103 paragraph 5a of the VAT Act, consisting in the introduction of goods from the territory of another Member State into a tax warehouse. With this in mind, the tax authority found that the Company had failed to pay the VAT due on the acquisitions in question within 5 days of introducing the diesel fuel into the territory of the country, and had failed to submit a monthly return concerning these acquisitions, and therefore, in its decision of April 6, 2018, imposed on the Company the obligation to immediately pay the VAT due, plus default interest.
The company appealed the decision, and the case went all the way to the Supreme Administrative Court. Given that the Supreme Administrative Court had significant doubts as to the compliance of the Polish regulations concerning the obligation to pay VAT in advance on intra-Community acquisitions of fuel with EU law, i.e., with Article 110 of the Treaty on the Functioning of the European Union and Articles 69, 206, and 273 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, as amended by Council Directive 2010/45/EU of 13 July 2010, it submitted a request for a preliminary ruling to the CJEU.
In its judgment, the CJEU ruled that Articles 69, 206 and 273 of the VAT Directive must be interpreted as precluding a provision of Polish law which imposes an obligation to pay VAT on intra-Community acquisitions of fuels before that tax becomes chargeable within the meaning of Article 69 of the VAT Directive.
This alert is for informational purposes only and does not constitute legal advice.
