CJEU – Recent Developments in Value Added Tax 2020

S. 1501. Introduction

The year 2020 will probably not be remembered for its large number of landmark cases on the taxable amount and VAT rates in EU VAT. Only a few cases have been decided. In this chapter, four cases will be analysed relating to the taxable amount and two cases on VAT rates. In addition, the Vodafone Portugal case will be discussed, which deals with the question of whether a termination fee is part of the consideration received for a supply of services.

2. Taxable amount

In the last twelve months, four cases relating to the taxable amount have been decided. They all relate, directly or indirectly, to the application of Art. 90 of the VAT Directive, which deals with the reduction of the taxable amount in case of cancellation, refusal, total or partial non-payment, or where the price is reduced after the supply takes place. There is an ever-growing body of case law on the adjustment of the taxable amount where a debtor has not paid his outstanding debts in full.

On the basis of Art. 90(1) of the VAT Directive (prior to the 2006 recast of the VAT Directive: Art. 11C(1) of the Sixth VAT Directive), the taxable amount of a supply is to be reduced in the case of cancellation, ref...