CJEU – Recent Developments in Value Added Tax 2017

S. 133Comment on “Free” Internet services

Sebastian Pfeiffer

1. S. 134Introduction

In the preceding chapter, the topic of whether “free” internet services are subject to VAT was discussed. However, the author’s conclusion is rather negative as to whether such services are inside the scope of VAT. Therefore, this comment aims at presenting a different conclusion solely on the basis of CJEU case law. This also gives ample opportunity to present the conclusions of the German speaking scholars that have recently dealt with this topic.

In principle, the main question of this comment is whether user data can constitute consideration for a supply of services, especially electronic services (e.g. access to social media platforms). In other words: is there a taxable supply where a service is performed without paying money but rather permitting the service provider to use data?

2. Taxable supply

In principle, the supply of goods or services for consideration within the territory of a Member State by a taxable person acting as such is within the scope of VAT. The pivotal question regarding “free” internet services is whether such services are performed for consideration. Regarding the question of a taxable sup...