CJEU - Recent Developments in Value Added Tax 2023

1. Introduction

As an American commentator whose expertise regarding consumption taxes lies principally with issues arising under the US subnational state retail sales tax (US RST), this author thought it would be appropriate to provide a US RST perspective on some of the issues raised by the cases discussed in Sebastian Pfeiffer’s illuminating contribution.

2. “Lost in Translation” Issues

Any effort to compare the EU VAT and the US RST treatment of taxable persons and related issues should begin by identifying potential “lost in translation” problems in connection with a comparative discussion of the two levies. The EU VAT is a consumption tax based on a staged collection process and identifies the “taxable person” as someone who is responsible for collecting the tax that ultimately falls on the final consumer. By contrast, under the single-stage US RST, intermediate transactions leading to the “taxable” sale to the final consumer who is generally identified as the “taxpayer” in the US RST context are typically characterized as nontaxable sales or exempt “sales for resale” by those who would be characterized as “taxable persons” under the EU VAT. With these semantic distinctions in m...