- The case involves the assessment of whether a lending fee paid to organization A by the state is considered a taxable service under VAT.
- According to copyright law, authors have the right to compensation for public lending of their works from libraries.
- Organization A acts as a collective management organization, receiving a portion of the state budget for lending fees and distributing them to authors.
- Authors register and list their works in an electronic system to claim lending fees.
- Lending fees are based on library lending statistics and are paid to authors according to actual lending numbers.
- The lending fee is considered a direct compensation for the service of allowing public lending of a work.
- Organization A sells a taxable service on behalf of the author when receiving lending fees.
- The state-paid lending fee to A is considered compensation for the right to lend works to the public.
- The transaction is treated as a commission sale under VAT law, involving two consecutive services.
- VAT treatment for the principal and commission agent’s sales must be determined independently.
- Compensation paid under copyright law is VAT-exempt unless paid to a collective management organization, in which case VAT is applicable.
Source: vero.fi
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.
