CJEU - Recent Developments in Value Added Tax 2024

1. Introduction

The right to deduct input VAT for taxable persons as goods and services are used for the taxable economic activity has repeatedly been held by the Court of Justice of the European Union (CJEU) to be a fundamental principle and an integral element of the common system of VAT. It aims at relieving taxable persons entirely of the burden of VAT payable or paid within the course of his or her economic activity. Hence, the deduction system is the most essential tool for ensuring the value added tax principle in the EU VAT found in Art. 1 in the VAT Directive achieving neutrality by only taxing the added value in each step of the production S. 302and distribution chain thereby resulting in a tax burden on consumption. The deduction system’s role and its limitations have continuously been discussed by the CJEU in its case law during the past year.

The objective of this chapter is to present the main developments in the case law from the CJEU in the past year concerning deduction of input VAT in the following four selected cases:

• C-341/22, 7 March 2024, Feudi di San Gregorio Aziende Agricole;

• C-537/22, 11 January 2024, Global Ink Trade;

• C-243/23, 12 September 2024, Drebers; and

• C-746/22, 16 May 2024, Slovenske Energeticke Strojarne.