Opinion of the Advocate General — ECLI:EU:C:2001:508
Date: 2001-10-04
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling
Origin: Austria

SUMMARY — CASE C-409/99 
Summary of the Judgment 
1. Tax provisions — Harmonisation of laws — Turnover taxes — Common system of 
value added tax — Deduction of input tax — Exclusions from the right of 
deduction — Open to Member States to retain exclusions existing when the Sixth 
Directive entered into force ·— Exclusion after that date of the right to deduct 
expenditure relating to certain motor vehicles after that right had been allowed by an 
administrative practice — Not permitted 
(Council Directive 77/388, Art. 17(6), second subpara.) 
2. Tax provisions — Harmonisation of laws — Turnover taxes — Common system of 
value added tax — Deduction of input tax — Exclusions from the right of 
deduction — Option for Member States to provide for certain exclusions for cyclical 
economic reasons — Conditions of exercise 
(Council Directive 77/388, Art. 17(7), first sentence) 
1. The second s u b p a r a g r a p h of 
Article 17(6) of the Sixth Directive 
77/388 on the harmonisation of the 
laws of the Member States relating to 
turnover taxes, which provides that 
until the entry into force of common 
rules determining the expenditure 
which is not eligible for deduction of 
value added tax the Member States 
may retain all the exclusions provided 
for under their national laws at the 
date of entry into force of the directive, 
precludes a Member State from exclud­
ing, after the entry into force of the 
Sixth Directive, expenditure relating to 
certain motor vehicles from the right to 
deduct where, at the date of entry into 
force of that directive, that expenditure 
gave rise to the right to deduct, albeit 
by virtue of a consistent practice of the 
public authorities of that State on the 
basis of a ministerial circular. In this 
respect, the term 'national laws' within 
the meaning of the second subpara­
graph of Article 17(6) does not refer 
only to legislative acts in the strict 
sense, but also to administrative meas­
ures and practices of the public auth­
orities of the Member State concerned. 
(see paras 49, 51 
and operative part 1) 
2. The first sentence of Article 17(7) of 
the Sixth Directive 77/388 on the 
harmonisation of the laws of the 
Member States relating to turnover 
taxes, which provides that, subject to 
consultation of the Advisory Commit­
tee on value added tax provided for in 
Article 29 of that directive, each 
Member State may, for cyclical econ­
omic reasons, totally or partly exclude 
all or some capital goods or other 
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METROPOL AND STADLER 
goods from the system of deductions, 
must be interpreted as not authorising 
a Member State to exclude goods from 
the system of deductions without first 
consulting that committee, since that 
procedural obligation is a condition 
precedent to the adoption of any meas­
ure on the basis of Article 17(7). That 
provision also does not authorise a 
Member State to adopt measures 
excluding goods from the system of 
deductions which contain no indication 
as to their limitation in time and/or 
which form part of a package of 
structural adjustment measures whose 
aim is to reduce the budget deficit and 
allow State debt to be repaid. 
(see paras 62-63, 69 
and operative part 2) 
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