The case involves a dispute over the application of reduced VAT rates to edible goods used as promotional items (advertising food). The taxpayer sold these advertising food products, which were individually customized for customers with specific packaging and prints. The tax authorities considered these sales as other services subject to the standard VAT rate instead of the reduced rate.The court ruling states that in the context of customs interpretation of § 12 Abs. 2 Nr. 1 in conjunction with Annex 2 of the VAT Act (UStG), the intended use of the product is only relevant if it is inherent in the product’s objective characteristics and properties. Usual packaging is not taken into account. Thus, simply using advertising food for promotional purposes is not sufficient to deny the reduced VAT rate.The taxpayer filed a revision, arguing that the promotional aspect of the product was of minor significance compared to the sale of the food itself. They claimed that the products should qualify for the reduced VAT rate according to customs principles, which focus on the characteristics of the goods.The tax authorities opposed the revision, maintaining that the primary intention of customers was to use the advertising food as promotional items, making them subject to the standard VAT rate.
Source: datenbank.nwb.de
