The article discusses the potential overturning of the apportionment requirement for supplies of accommodation services by the European Court of Justice (ECJ), which could have significant implications for the hotel industry in Germany.
Apportionment Requirement for Accommodation Services
– The German VAT Act requires an apportionment of accommodation services, where only the supply of accommodation is subject to the reduced VAT rate, while ancillary services are taxed at the standard rate.
– This apportionment requirement has been debated and challenged in recent years, with the German Federal Fiscal Court now doubting its compliance with EU law.
Doubts about the Lawfulness of the Apportionment Requirement
– The ECJ’s judgment in the Stadion Amsterdam case ruled that a single supply should not be split up, leading the German Federal Fiscal Court to grant suspension of VAT execution for supplies of accommodation services.
– The ECJ’s recent judgment in the Finanzamt X case further confirmed that an economically single supply should not be artificially split up, even by legal measures of the Member States.
ECJ Referrals on the Apportionment Requirement
– The German Federal Fiscal Court has made three referrals to the ECJ, questioning whether the apportionment requirement for supplies of accommodation services complies with EU law.
– The referrals focus on whether the apportionment requirement is contrary to EU law if it excludes dependent ancillary services from the reduced VAT rate for accommodation services.
Conclusion and Implications
– The hotel industry is eagerly awaiting the ECJ’s decision, as a potential overturning of the apportionment requirement could have significant financial implications.
– Taxable persons affected by the apportionment requirement should consider filing appeals and applying for suspension of proceedings, referencing the ECJ referrals.
Source: kmlz.de
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
