Opinion of the Advocate General — ECLI:EU:C:2005:99
Date: 2005-02-22
Language of the case: English
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling
Origin: United Kingdom

Summary of the Judgment 1. Tax provisions — Harmonisation of laws — Turnover taxes — Common system of value added tax — Exemptions provided for by the Sixth Directive — Exemption of services linked to welfare and social security and of services linked to the protection of children and young persons supplied by bodies governed by public law or other organisations recognised as charitable — Word ‘charitable’ in the English version — Criteria for interpretation — Account to be taken of the various language versions (Council Directive 77/388, Art. 13A(1)(g) and (h)) 2. Tax provisions — Harmonisation of laws — Turnover taxes — Common system of value added tax — Exemptions provided for by the Sixth Directive — Exemption of services linked to welfare and social security and of services linked to the protection of children and young persons supplied by bodies governed by public law or other organisations recognised as charitable — Meaning of ‘organisations recognised as charitable’ — Private, profit-making entities — Included (Council Directive 77/388, Art. 13A(1)(g) and (h)) 3. Tax provisions — Harmonisation of laws — Turnover taxes — Common system of value added tax — Exemptions provided for by the Sixth Directive — Exemption of services linked to welfare and social security and of services linked to the protection of children and young persons supplied by bodies governed by public law or other organisations recognised as charitable — National authorities’ discretion as regards the recognition of charitable nature — Review by national courts — Limits (Council Directive 77/388, Art. 13A(1)(g) and (h)) 1. The word ‘charitable’ in the English version of Article 13A(1)(g) and (h) of Sixth Directive 77/388 on the exemption from value added tax of supplies linked to welfare and social security work and of supplies linked to the protection of children and young persons, has its own independent meaning in Community law which must be interpreted taking account of all the language versions of that directive. Whether a specific transaction is subject to or exempt from value added tax cannot depend on its classification in national law; in addition, the need for a uniform interpretation of Community directives makes it impossible for the text of a provision to be considered, in case of doubt, in isolation and, on the contrary, it requires that it be interpreted and applied in the light of the versions existing in the other official languages. (see paras 25-27, operative part 1) 2. Article 13A(1)(g) and (h) of Sixth Directive 77/388 on the exemption from value added tax of supplies linked to welfare and social security work and of supplies linked to the protection of children and young persons, are to be interpreted as meaning that the expression ‘organisations recognised as charitable by the Member State concerned’ does not exclude private, profit-making entities. Where the Community legislature, as in Article 13A(1)(g) and (h), has not expressly made entitlement to the exemptions in question subject to the absence of a profit-making aim, the pursuit of such an aim cannot preclude entitlement to those exemptions. In addition, the principle of fiscal neutrality would not be observed if, where the national legislature has not made the exemption subject to the condition, under the first indent of Article 13A(2)(a) of the Sixth Directive, that the organisations in question have no systematic profit-making aim, the welfare services covered in Article 13A(1)(g) and (h) were treated differently for value added tax purposes depending on whether the entities which provide them are profit-making or not. (see paras 40, 42, 47, operative part 2) 3. Article 13A(1)(g) and (h) of Sixth Directive 77/388 on the exemption from value added tax of supplies linked to welfare and social security work and of supplies linked to the protection of children and young persons, grant the Member States a discretion to recognise as charitable certain organisations not governed by public law. However, it is for the national courts to determine, having regard, in particular, to the principles of equal treatment and fiscal neutrality, and taking account of the content of the supplies of services in question, as well as the conditions for making them, whether the recognition of a private profit-making entity, which as such does not have charitable status under domestic law, as charitable for the purposes of the exemptions under those provisions exceeds the discretion granted by those provisions to the Member States for the purposes of such recognition. (see paras 51, 58, operative part 3)