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Comments on ECJ C-606/22: Unjust Enrichment and VAT Refunds: A Complex and Misunderstood Issue

  • Tax authorities can deny a refund of overpaid VAT on the ground of unjust enrichment.
  • Under EU law, the issue is complex and has been misunderstood by tax officers, legal advisors, and courts.
  • However, it has been authoritatively stated that unjust enrichment in a B2C scenario is virtually impossible.
  • This is because the supplier will always suffer, either by losing sales if they increase prices to account for higher VAT, or by losing profits if they cannot increase prices.
  • The only exception is if all suppliers of a product with inelastic demand make the same mistake, which is very rare in practice.

Source Fabian Barth

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