VAT
In his foreword to the new series of Simon's First-Tier Tax Decisions, Sir Stephen Oliver observes that "Value Added Tax law, when introduced in 1972, was mistakenly perceived to be dead simple and unproductive of legal principle."
An example of how wrong that perception was is given in Case C-29/08 Skatteverket v AB SKF (ECJ, 29.10.09). In issue was the deductibility of input tax on services supplied for the purposes of a share disposal. The right to deduct was held to exist where there is a direct and immediate link between the costs associated with the input services and the overall economic activities of the taxable person.
The rules on deduction of input tax sometimes seem as if they were primarily concerned with the world of the peasant artisan. This judgment of the ECJ may be seen as a further step in facilitating the operation of VAT in economies where intangibles and services are vital.
Anti-Dumping Duty
Chinese imports have led to a considerable amounts of work in the field of customs and anti-dumping. In Case C-373/08 Hoesch Metals and Alloys GmbH v Hauptzollamt Aachen (ECJ,11.2.2010) imports of Chinese silicon were under consideration. The case demonstrates how important the burden of proof can be for an appellant alleging the invalidity of an EU regulation.
In deciding whether the silicon had undergone sufficient processing in India to have an Indian origin the judgment paid some attention to the "list rules". These contain the provisional results of negotiations under the auspices of the WTO. They were not fully set out in the judgment. Click here to see the current version. (If re-directed to general document search return to this page and repeat click.)
Now that substantial progress has been made towards the final text (see the Council web-site) some further questions are attracting attention. Some of these are noted in the interesting editorial of Michel Aujean in the EC Tax Review 2010/1,pp 2-3; "Savings Taxation: Is Automatic Exchange of Information Becoming a Panacea?"
In relation to exchange of information he asks:
"Will the tax administrations be able to cope with such a flow of information? Will the quality of the information improve so as to make it easier for tax administrations to use it in the most effective way?
Then he puts two other questions:
"To what extent will the financial markets be able to innovate in new mechanisms that will once again permit some investors to escape their obligations? Finally, is the future of the single market for financial products compatible with the future of residence taxation for individuals?"
No doubt these questions will be asked in many quarters in the future.