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CJEU Case C-419/14 / Opinion

WebMindLicenses Kft v Nemzeti Adó- és Vámhivatal Kiemelt Adó- és Vám Főigazgatóság

Policy area:
Taxation
Deciding Body type:
Court of Justice of the European Union
Deciding Body:
Advocate General
Type:
Opinion
Decision date:
16/09/2015

Key facts of the case:

Request for a preliminary ruling from the Fővárosi Közigazgatási és Munkaügyi bíróság (Administrative and Labour Court, Budapest, Hungary)

  1. While the present request for a preliminary ruling is another case in which the Court is asked to answer questions concerning the interpretation of the concept of abuse of rights in tax matters (in this instance, value added tax (VAT)), it also raises interesting questions concerning the interface between the powers of taxation exercised by the Member States and the Charter of Fundamental Rights of the European Union ('the Charter'), in particular the right to respect for private and family life enshrined in Article 7 of the Charter and the right to the protection of personal data enshrined in Article 8 of the Charter.

Results (sanctions) and key consequences of the case:

142. I therefore propose that the Court’s answers to the questions referred for a preliminary ruling by the Fővárosi Közigazgatási és Munkaügyi bíróság (Administrative and Labour Court, Budapest) should be as follows:

  1. The conclusion of a licensing agreement such as that at issue in the main proceedings may be regarded as an abuse in the light of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax only if its essential aim is to obtain a tax advantage the grant of which would be contrary to the purpose of the provisions of that directive, an issue which it is for the referring court to determine.
  2. The risk of double taxation does not prevent the tax authorities of a Member State from reclassifying the place of supply of a service as being in its territory.
  3. Council Regulation (EU) No 904/2010 of 7 October 2010 on administrative cooperation and combating fraud in the field of value added tax (recast) must be interpreted as not imposing on the tax authorities of a Member State which discover the existence of a value added tax debt an obligation to send a request to the tax authorities of the Member State in which the taxable person forming the subject of the tax inspection has already fulfilled his obligation to pay value added tax. It is for the referring court to determine whether the evidence forming the basis of the Hungarian tax authorities’ decision finding the existence of abuse is sufficient to support the existence of the tax debt.
  4. The gathering of evidence, in the course of a criminal procedure running parallel to the procedure for the adjustment of value added tax, by intercepting telephone conversations and seizing and storing emails is compatible with Articles 7 and 8 of the Charter of Fundamental Rights of the European Union only if it is provided for by law, pursues a legitimate purpose and is proportionate, an issue which it is for the referring court to assess.