Judgment — ECLI:EU:C:2015:454
Date: 2015-07-09
Language of the case: Romanian
Court formation: Seventh Chamber
Subject matter: Taxation;Principles, objectives and tasks of the Treaties;Value added tax
Procedure: Reference for a preliminary ruling
Origin: Romania

Summary — Judgment of the Court (Seventh Chamber), 9 July 2015 1. EU law — Principles — Legal certainty — Rules which may entail financial consequences 2. EU law — Principles — Legal certainty and protection of individuals — National regulation in a field governed by EU law — Need for unequivocal wording 3. EU law — Principles — Protection of legitimate expectations — Conditions — Specific assurances given by the authorities 4. Harmonisation of fiscal legislation — Common system of value added tax — Deduction of input tax — Administrative practice of the tax authorities consisting of reclassifying, following a tax audit, a transaction as an economic activity subject to value added tax and imposing surcharges — Lawfulness — Infringement of the principles of legal certainty and of the protection of legitimate expectations — No such infringement — Obligation to comply with the principle of proportionality — Verification a matter for the national court 5. Harmonisation of fiscal legislation — Common system of value added tax — Deduction of input tax — National rules making the deduction of input value added tax, due or paid on goods and services used in the context of taxed transactions, in the event of belated identification of the taxable person, subject to compliance with certain conditions — Fulfilment of the substantive requirements of the right to deduction and identification of the taxable person for value added tax purposes — Unlawful (Council Directive 2006/112, Arts 167, 213 and 214) 1. See the text of the decision. (see para. 31) 2. See the text of the decision. (see para. 32) 3. See the text of the decision. (see para. 45) 4. The principles of legal certainty and of the protection of legitimate expectations do not preclude a national tax authority from deciding, following a tax audit, to subject transactions to value added tax and to impose the payment of surcharges, provided that that decision is based on clear and precise rules and that that authority’s practice has not been such as to give rise, in the mind of a prudent and well-informed trader, to a reasonable expectation that that tax would not be levied on such transactions, this being a matter for the referring court to determine. The surcharges applied in such circumstances must comply with the principle of proportionality. (see para. 53, operative part 1) 5. Directive 2006/112 on the common system of value added tax precludes national rules under which the right to deduct input value added tax, due or paid on goods and services used in the context of taxed transactions, is refused to the taxable person, who must nevertheless pay the tax that he ought to have recovered, for the sole reason that he was not identified for value added tax purposes when he carried out those transactions, so long as he has not been duly identified for value added tax purposes and the tax return for the tax due has not been filed. 6. The right to deduct is a fundamental principle of the common system of value added tax, which in principle may not be limited, and is exercisable immediately in respect of all the taxes charged on transactions relating to inputs. Moreover, the principle of value added tax neutrality requires that deduction of input value added tax be allowed if the substantive requirements are satisfied, even if the taxable person has failed to comply with some of the formal requirements. Consequently, where the tax authority has the information necessary to establish that the substantive requirements have been satisfied, it cannot, in relation to the right of the taxable person to deduct that tax, impose additional conditions which may have the effect of rendering that right ineffective for practical purposes. In that regard, identification for value added tax purposes, provided for in Article 214 of Directive 2006/112, and the obligation of the taxable person to state when his activity as a taxable person commences, changes or ceases, provided for in Article 213 of that directive, are only formal requirements for the purposes of control, and they cannot undermine, inter alia, the right to deduct value added tax in the case where the substantive conditions which give rise to that right are satisfied. With regard to penalising the failure on the part of the taxable person to comply with the obligations relating to accounts and tax returns by a denial of the right to deduct, it clearly goes further than is necessary to attain the objective of ensuring the correct application of those obligations, since EU law does not prevent Member States from imposing, where necessary, a fine or a financial penalty proportionate to the seriousness of the offence. (see paras 56, 58-60, 63, 65, operative part 2)