Comments on ECJ C-622/23: VAT Deduction Valid for Free Equipment Linked to Taxable Activities

• The European Court of Justice ruled on VAT deductions for equipment provided free of charge
• The case involved Voestalpine Giesserei Linz GmbH, an Austrian company manufacturing in Romania
• Voestalpine provided a crane to a subcontractor in Romania without charge
• Romanian tax authorities initially denied VAT deduction for the crane
• The CJEU supported the company’s right to deduct VAT, emphasizing VAT system neutrality and the fundamental right to deductions
• Deductions are valid if linked objectively to the taxpayer’s economic activities
• The crane was essential for Voestalpine’s production and contractual obligations
• Providing equipment free to subcontractors does not sever the link to the owner’s economic activities if a direct and immediate link to economic activities exists

Source: insightplus.bakermckenzie.com

See also

• ECJ VAT Case C-622/23 (RHTB) – Judgment – VAT Implications in Work Contract Cancellations

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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.