The Arnhem-Leeuwarden Court of Appeal ruled that both public bodies and special members are considered ‘affiliated’ to X under the Decree for Associations of Undertakings. Public bodies are not required to carry out 100% economic activities. X is a national trade association in the field of asset management, with both corporate and non-corporate members, as well as special members without voting rights. X levies a contribution on its activities and does not charge VAT. The tax inspector imposed additional VAT assessments on X, but the Court of Appeal ruled that X can rely on the approval of associations of undertakings in the Decree and is entitled to deduct the VAT charged to it. The Court of Appeal considered it important that VAT cumulation occurs for the public bodies as a result of the interposition of X, and reduced the additional assessments.
Source Taxlive
