ECJ C-68/23 (Finanzamt O) – Judgment – Definition of single-purpose and multi-purpose vouchers

On April 18, 2024, the ECJ issued the judgment in the case C-68/23 (Finanzamt O).

Context: Preliminary ruling – Common system of value added tax – Directive 2006/112/EC – Articles 30a and 30b – Vouchers delivered electronically – Single-purpose vouchers and multi-purpose vouchers – Prepaid cards or voucher codes intended for the purchase of digital content and provided with a country code “which makes the digital content in question available only in the Member State concerned

Article in the EU VAT Directive

Article 30a
For the purposes of this Directive, the following definitions shall apply:
(1) ‘voucher’ means an instrument where there is an obligation to accept it as consideration or part consideration for a supply of goods or services and where the goods or services to be supplied or the identities of their potential suppliers are either indicated on the instrument itself or in related documentation, including the terms and conditions of use of such instrument;
(2) ‘single-purpose voucher’ means a voucher where the place of supply of the goods or services to which the voucher relates, and the VAT due on those goods or services, are known at the time of issue of the voucher;
(3) ‘multi-purpose voucher’ means a voucher, other than a single- purpose voucher.

Article 30b
1. Each transfer of a single-purpose voucher made by a taxable person acting in his own name shall be regarded as a supply of the goods or services to which the voucher relates. The actual handing over of the goods or the actual provision of the services in return for a single-purpose voucher accepted as consideration or part consideration by the supplier shall not be regarded as an independent transaction.
Where a transfer of a single-purpose voucher is made by a taxable person acting in the name of another taxable person, that transfer shall be regarded as a supply of the goods or services to which the voucher relates made by the other taxable person in whose name the taxable person is acting.
Where the supplier of goods or services is not the taxable person who, acting in his own name, issued the single-purpose voucher, that supplier shall however be deemed to have made the supply of the goods or services related to that voucher to that taxable person.
2. The actual handing over of the goods or the actual provision of the services in return for a multi-purpose voucher accepted as consideration or part consideration by the supplier shall be subject to VAT pursuant to Article 2, whereas each preceding transfer of that multi-purpose voucher shall not be subject to VAT.
Where a transfer of a multi-purpose voucher is made by a taxable person other than the taxable person carrying out the transaction subject to VAT pursuant to the first subparagraph, any supply of services that can be identified, such as distribution or promotion services, shall be subject to VAT.

Facts

The parties disagree as to whether the transfer of prepaid cards or voucher codes for the purchase of digital content, known as X cards, are subject to VAT.
During the 2019 tax period (the year at issue), the applicant sold X cards via its X cards online shop. In the year at issue, Y, which is established in the United Kingdom, was the publisher of the X cards. The voucher codes allowed the purchaser to load his or her X user account with a certain nominal value in euros. After loading the account, digital content could be purchased by the account holder in Y’s X store at the prices indicated therein.
The X cards were distributed by Y with different country codes through various intermediaries. The code DE was intended for customers with their domicile or habitual residence in Germany and a German X user account.
During the year in question, the applicant purchased X cards from two suppliers who were not established in the United Kingdom or Germany, but in other Member States. They had previously acquired the X cards from Y. In its tax returns, the applicant did not mention either the acquisition of the X cards from suppliers nor their transfer to end customers. It acted on the assumption that X cards were vouchers or multi-purpose vouchers.
In contrast, the competent Finanzamt (tax office) took the view that the applicant’s turnover with X cards was taxable in Germany because the cards with the identifier DE were intended exclusively for final customers resident in Germany with a German user account. Classification of those cards as goods vouchers or single-purpose vouchers is also supported by the fact that Y had placed the cards as such on the market and that, in the subsequent performance chain, they were treated as such by all the other parties.
The Finanzgericht (Finance Court) dismissed the action brought against that decision, whereupon the applicant brought an appeal on a point of law before the referring court.

Questions

1. Does a single-purpose voucher exist within the meaning of Article 30a(2) of the VAT Directive where:
– the place of supply of the services to which the voucher relates is established in known in so far as those services are intended to be supplied to final consumers within the territory of a Member State,
– but the fiction of the first subparagraph of Article 30b(1) first sentence of the VAT Directive, according to which the transfer of the voucher between taxable persons with a view to providing the service to which the voucher relates, also gives rise to a service in the territory of another Member State?
2. If the first question is answered in the negative (and hence a multi-purpose voucher exists in the present case): Does subparagraph 1 of Article 30b(2) of the VAT Directive, according to which the actual provision of the services in return for a multi-purpose voucher accepted as consideration or part consideration by the supplier is subject to VAT pursuant to Article 2 of the VAT Directive, whereas each preceding transfer of that multi-purpose voucher is not subject to VAT, preclude a differently substantiated tax obligation (judgment of the Court of Justice of the European Union of
3 May 2012, Lebara, C-520/10, EU:C:2012:264)?

AG Opinion

None

Decision

1. Articles 30a and 30b paragraph 1 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, as amended by Council Directive (EU) 2017/2455 of 5 December 2017

are to be interpreted as follows:

The classification of a voucher as a “single-purpose voucher” within the meaning of Article 30a(2) of Directive 2006/112, as amended, depends only on the conditions set out in that provision, including the requirement that the place where the service is provided which is addressed to final consumers and to which this voucher relates, must be established at the time of issue of this voucher, regardless of whether this voucher is transferred between taxable persons acting in their own name and established in Member States other than that, in which these end users are located.

2. Article 30b(2) of Directive 2006/112, as amended by Directive 2017/2455

is to be interpreted as follows:

The resale by a taxable person of “multi-purpose vouchers” within the meaning of Article 30a(3) of Directive 2006/112, as amended, may be subject to VAT provided that it is classified as a supply of services to the taxable person who, in return for those vouchers, actually delivers the goods to the end consumer or actually provides the services to the end consumer.

Summary

— The CJEU has clarified that a voucher is considered a single-purpose voucher (SPV) if the place of supply to the final consumers is known at the time of its issue, regardless of transfers between taxable persons in different Member States.
— The definition of an SPV in the EU VAT Directive emphasizes that the relevant supply refers to the goods or services for which the voucher will be redeemed, not any transfers of the voucher itself.
— This clarification has implications for B2B transfers of vouchers that can only be redeemed by private individuals in a specific EU Member State, as the VAT due on these transfers is subject to the local VAT rate of the Member State where the voucher will be redeemed. This may require VAT registrations for businesses involved in such transfers.

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