News & Media

The Contents of Highlights & Insights on European Taxation, Issue 2, 2023

Please find below a selection of articles published this February in Highlights & Insights on European Taxation, plus one freely accessible article.

Highlights & Insights on European Taxation (H&I) is a publication by Wolters Kluwer Nederland BV.

The journal offers extensive information on all recent developments in European Taxation in the area of direct taxation and state aid, VAT, customs and excises, and environmental taxes.

To subscribe to the Journal’s page, please click HERE


Year 2023, no. 2



–  Code of Conduct Group (Business Taxation) – Report to the Council

(comments by Raymond Luja) (H&I 2023/2)

–  Broader scope of revised Code of Conduct for Business Taxation  

(comments by Raymond Luja) (H&I 2023/4)



–  VAT in the Digital Age. Real-time digital reporting based on e-invoicing for businesses

(comments by Marta Papis-Almansa) (H&I 2023/22)

–  VAT in the Digital Age. Updated VAT rules for the platform economy

(comments by Giorgio Beretta) (H&I 2023/23)

–  VAT in the Digital Age. Introduction of a single VAT registration across the EU

(comments by Pawel Mikula) (H&I 2023/24)



–  Navitours Sàrl (C-294/21)Place where transport services are supplied. Tourist trips on the Moselle. Court of Justice

(comments by Aikaterini Pantazatou) (H&I 2023/8)

–  Vittamed technologijos (C-293/21)Obligation to adjust VAT deductions in case of liquidation taxable person and removal from register of VAT payers. Court of Justice

(comments by Jette Thygesen) (H&I 2023/6)

–  MC v Direktor na Direktsia ‘Obzhalvane i danachno-osiguritelna praktika’ (C-1/21)Bulgarian liability rules for VAT debts. Court of Justice

(comments by Svetlin Krastanov) (H&I 2023/7)

–  HUMDA (C-397/21)EU law precludes Hungarian VAT rules on refund of wrongly charged VAT. Liquidation of the provider. Court of Justice

(comments by Tamás Fehér) (H&I 2023/16)

–  Climate Corporation Emissions Trading (C-641/21)Transfer of greenhouse gas emission allowances. Place of supply of service. Court of Justice  

(comments by Christina Pollak) (H&I 2023/17)

–  Luxury Trust Automobil (C-247/21)Triangular transaction. Missing reference to ‘Reverse charge’. Court of Justice

(comments by Matthias Oldiges) (H&I 2023/26)



–  Shell Deutschland Oil (C-62/21)EU law precludes German refusal to grant tax reduction after expiry of time limit for making application. Court of Justice

(comments by Edwin Thomas) (H&I 2023/3)

–  TanQuid Polska (C-139/20)Suspension arrangement. Fraud by third parties. Court of Justice

(comments by Diederik Bogaerts) (H&I 2023/15)



–  Orde van Vlaamse Balies (C-694/20)Obligation for a lawyer to inform other intermediaries involved infringes the right to respect for communications with client

(comments by Edwin Thomas) (H&I 2023/5)



–  Tackling distortive foreign subsidies on the internal market. Council

(comments by Raymond Luja) (H&I 2023/1)



–  Navitours Sàrl (C-294/21)Place where transport services are supplied. Tourist trips on the Moselle. Court of Justice

(comments by Aikaterini Pantazatou) (H&I 2023/8)


The case is of a very particular nature as it raises for the first time the issue of levying VAT on transport services that are supplied entirely in a Condominium. As there is no other Condominium (entirely) within the EU, the case does not offer any directly transposable findings to similar situations. Yet, it does provide valuable insights into the CJ​​’​s priorities and understanding of the neutrality principle. One could argue that the elaborate analysis of ‘transport services’ for Article 9(2)(b) of the Sixth Directive has been subsequently (partly) rendered superfluous because of the particular reference to Article 48 of the Recast VAT Directive (Council Directive of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1) to the place of supply of ‘passenger transport’, which shall be ‘the place where the transport takes place, proportionate to the distances covered.’

The outcome of both the Opinion and the judgment appears to throw the ball to the two countries involved to solve the situation themselves and, thus, make use of Article 5 in the Treaty of 19 December 1984 between Luxembourg and Germany. Under the guise of the neutrality principle, both the CJ and the AG implicitly endorse a ‘first come, first served’ basis, on the grounds that as long as the obligation to levy VAT is fulfilled, then the obligations arising from the VAT Directive are met.

The reasoning behind this solution first highlights that the territoriality principle does not suffice to solve the problem in cases of joint sovereignty. While it could be used to ensure that all domestic activities are taxed in the territory of a country – however this is understood in the context of the Condominium – (‘obligation to tax’), both the Court and the AG rely instead on the neutrality principle, as an expression of the general principle of equal treatment. This understanding is certainly not new, as the CJ has highlighted on several occasions that the general principle of equal treatment, of which the principle of fiscal neutrality is a particular expression in VAT law, requires similar situations not to be treated differently unless differentiation is objectively justified (see, for instance, CJ 19 December 2012, C‑549/11 Orfey BalgariaECLI:EU:C:2012:832, para. 32). However, in the present case, the neutrality principle comes with a dual connotation: first, to justify the obligation of one Member State to levy VAT on services provided in the Condominium to ensure that taxable persons in the Condominium are not treated more favourably than similar taxpayers (‘obligation to tax’), but also to ensure that those services are not subject to double taxation as this would also disrupt the neutrality principle for treating the Condominium taxpayers less favourably (‘obligation of non-double taxation’). Indeed, while the territoriality principle could have satisfied the first condition, it would not suffice for the second.

But is the neutrality principle, in the sense of equal treatment, really satisfied here? First, if both Member States are competent to levy VAT on transport services supplied along the Condominium, then it is possible that similar, if not the same, operations are subject to different tax rates, depending on who levies VAT first. This result is probably a distortion of the neutrality principle, which is already limited by the different applicable tax rates in the EU. However, this limitation is accepted to the extent that those different rates do not apply to the same activities in the same territory, which is exactly what would happen in this case, compromising both the legal and economic aspects of the neutrality principle. This potentially different treatment of similar services also raises issues regarding another facet of the neutrality principle: VAT uniformity. As the Court clearly stated in the Commission v Francejudgment (CJ 3 May 2001, C-481/98 Commission v FranceECLI:EU:C:2001:237): ‘[T]he principle of fiscal neutrality […] also includes […] the principles of VAT uniformity and of elimination of distortion in competition.’

Second, if both Member States are competent to levy VAT in the Condominium, ensuring that double taxation is avoided may create an additional burden on tax administrations that will have to exchange information on the VAT charged on the services supplied there. While this issue may be solved by an agreement on the allocation of taxing rights, as proposed by the AG and the CJ, another administrative burden may arise on the taxpayers in the possible scenario of a quasi-simultaneous levy of VAT by both States. That would be the case, for instance, if VAT were levied by each State (inadvertently as to the double taxation arising), with a few days of difference. In that case, the taxpayer would have to collect and submit proof that they have already paid VAT in the first Member State that levied the tax.

Furthermore, as there are more boat tour operators along the Mosel, if no agreement is concluded between the two States and if the promoted solution remains the ‘first come, first served’, another fundamental principle of EU law may be compromised – that of legal certainty, the importance of which in VAT law was recently highlighted by the CJ in the Agenzia delle dogane e dei monopoli case (CJ 12 May 2022, C-714/20 Agenzia delle dogane e dei monopoliECLI:EU:C:2001:237, paras. 60-61). As was also raised by the parties before the domestic courts, if both Germany and Luxembourg could levy tax, taxpayers would be unable to properly foresee and predict how their activities would be taxed (by which State and at which rate).

The obligation to tax as a corollary of the neutrality principle appears, thus, to take precedence in the CJ​​’​s reasoning. This is in line with the letter of the VAT Directive. However, this approach also raises certain questions, as highlighted above. Despite the possible inconsistencies that emanate therefrom, it has to be acknowledged that the CJ could not have allocated a taxing right to one of the two involved Member States without going against the letter of the VAT Directive.

Aikaterini Pantazatou

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