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Comments on ECJ C-733/22 (Valentina Heights) – Tourist certificates for rental and VAT rate

The Bulgarian company rented tourist apartments and applied a reduced 9% VAT rate when it had the appropriate certificate. The tax authority disagreed and required the company to apply the standard 20% VAT rate when it did not have the certificate. The Court ruled that the requirement of having a certificate for applying the reduced VAT rate is not permissible. It stated that the rental of apartments falls under “accommodation provided in hotels and similar establishments” which allows for a reduced VAT rate. The Court also emphasized that the requirement of a certificate does not constitute a “concrete and specific aspect” and may violate the principle of neutrality. Additionally, it highlighted that tax evasion and avoidance concerns should not be used to justify the requirement of a certificate for applying the reduced VAT rate.

Source Pawel Mikula

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