Opinion of the Advocate General — ECLI:EU:C:2020:144
Date: 2020-03-03
Language of the case: Dutch
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling
Origin: Netherlands

Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court of Justice 
Date lodged:  
17 December 2018 
Referring court:  
Hoge Raad der Nederlanden 
Date of the decision to refer:  
14 December 2018 
Applicant:  
Stichting Schoonzicht 
Other party to the proceedings:  
Staatssecretaris van Financiën 
Subject of the action in the main proceedings 
The main proceedings concern the deduction of VAT owed by Stichting 
Schoonzicht upon the delivery of an apartment complex. More specifically, in 
dispute is whether the initial deduction may be adjusted in a single step when, at 
the time at which the complex was first used, it emerged that it deviates from the 
deduction which Stichting Schoonzicht is entitled to apply.  
Subject matter and legal basis of the request for a preliminary ruling 
This request under Article 267 TFEU concerns the question of whether the ‘single 
adjustment’ of the initial deduction as provided for under Netherlands law is 
contrary to the EU law adjustment procedure whereby the adjustment is spread 
over a given period. 
Questions referred 
1. Do Articles 184 to 187 of the 2006 VAT Directive preclude a national 
adjustment regime for capital goods which provides for an adjustment 
spread over a number of years, whereby in the year the goods enter into use 
EN 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-791/18 
 
2  
– which year is moreover the first adjustment year – the total amount of the 
initial deduction for that capital good is adjusted (revised) in a single step, if, 
upon the entry into use thereof, it turns out that that initial deduction 
deviates from the deduction which the taxable person is entitled to apply on 
the basis of the actual use of the capital good? 
If Question 1 is answered in the affirmative: 
2. Must Article 189(b) or (c) of the 2006 VAT Directive be interpreted as 
meaning that the single adjustment of the initial deduction in the first year of 
the adjustment period referred to in Question 1 constitutes a measure which 
the Netherlands may adopt for the application of Article 187 of the 2006 
VAT Directive? 
Provisions of EU law cited 
Articles 184 to 187 and 189 of Council Directive 2006/112/EC of 28 November 
2006 on the common system of value added tax (‘the 2006 VAT Directive’). 
Provisions of national law cited 
Article 15(4) of the Wet op de omzetbelasting 1968 (Law on turnover tax 1968; 
‘OB’) and Articles 12 and 13 of the Uitvoeringsbeschikking omzetbelasting 1968 
(Implementing decision on turnover tax 1968). 
Brief outline of the facts and the procedure in the main proceedings 
1 Stichting Schoonzicht (‘the party concerned’) built an apartment complex 
comprising seven apartments on a plot of land belonging to it, which was 
delivered in July 2014. As the complex was originally intended for taxable 
purposes, the party concerned deducted in full the VAT owed on that delivery. 
Subsequently, however, from 1 August 2014, it rented out four of the apartments 
applying an exemption from turnover tax. For that reason, the deduction it had 
initially applied was adjusted pursuant to Article 15(4) OB, meaning that it still 
owed the part of the VAT to be calculated for those apartments over the third 
quarter of 2014, amounting to EUR 79 587. The party concerned paid that amount 
on declaration. 
2 The party concerned made an objection to that self-assessment. It considers that, 
in the case of capital goods, adjustment of the entire initial deduction at the time at 
which that capital good was first used, as provided for in Article 15(4) OB, is 
contrary to Article 187 of the 2006 VAT Directive. That objection was dismissed 
by the Inspecteur van de Belangendienst (tax inspector). The party concerned 
subsequently brought an appeal against that dismissal before the Rechtbank 
Noord-Holland (District Court, North Holland). The Rechtbank declared that 
STICHTING SCHOONZICHT 
 
3 
appeal unfounded, after which the party concerned brought a further appeal before 
the Gerechtshof Amsterdam (Court of Appeal; ‘the Gerechtshof’). The 
Gerechtshof held that the regime of Article 15(4) OB fell within the scope of the 
2006 VAT Directive and consequently declared the further appeal unfounded. 
3 The party concerned lodged an appeal in cassation against that judgment before 
the Hoge Raad der Nederlanden (Supreme Court of the Netherlands; ‘the Hoge 
Raad’). That court decided to refer questions to the CJEU for a preliminary ruling. 
Principal arguments of the parties to the main proceedings 
4 In the main proceedings, the party concerned reiterates the argument put forward 
before the Gerechtshof, according to which single adjustment of the initial 
deduction in response to the entry into use of capital goods is contrary to Article 
187 of the 2006 VAT Directive. According to the party concerned, the adjustment 
regime of Article 187 of the 2006 VAT Directive should namely be considered in 
isolation, separate from what is set out in Articles 184 and 185, and therefore also 
separate from the detailed rules for applying those articles laid down by Member 
States in accordance with Article 186. This would be a special regime for capital 
goods, superseding the general regime of Articles 184 and 185. There is no room, 
then, for single adjustment of the entire initial deduction, as is provided for in 
Articles 184 and 185, upon the entry into use of a capital good. On the contrary, 
the adjustment of the initial deduction for capital goods pursuant to Article 187 
must mandatorily be spread over a number of years. At the end of each adjustment 
year, only adjustment of a proportional part of the initial deduction may take 
place. Given that the Netherlands legislation provides for an adjustment period of 
10 years, it is one tenth in this case. 
5 This plea is directed against the finding of the Gerechtshof that the adjustment 
regime of Article 15(4) OB falls within the scope of the 2006 VAT Directive. 
According to the Gerechtshof, the Netherlands legislature has used the possibility 
afforded to Member States by Article 189(b) of the 2006 VAT Directive to 
specify the amount of the VAT to be taken into consideration in the adjustment for 
capital goods. The single adjustment provided for in Article 15(4) OB must, in the 
view of the Gerechtshof, be regarded as a ‘pre-adjustment correction’, for which 
the 2006 VAT Directive contains no provisions. In the view of the Gerechtshof, 
the 2006 VAT Directive does not preclude such an adjustment, given that the 
result thereof – having regard to the subsequent adjustment period – is not in 
breach of the principle of tax neutrality and/or the proportionality principle. 
Brief outline of the reasons for the referral 
6 According to the Hoge Raad, the position of the party concerned is supported by 
the wording of Article 187 of the 2006 VAT Directive, which can indeed be 
construed as meaning that adjustment, in a 10-year adjustment period, can in the 
first year consist only in one tenth of the VAT on the capital good. Moreover, that 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-791/18 
 
4  
wording leaves no doubt as to the mandatory nature of Article 187, from which it 
may be concluded that the Member States have no scope to deviate from that 
provision. 
7 Contrary to the position of the party concerned, it can be argued that the 
adjustment regime of Article 187 of the 2006 VAT Directive can equally be 
construed as a supplementary regime which must be interpreted in conjunction 
with Articles 184 to 186. In this connection, the Hoge Raad notes that the 
adjustment in general and the spreading thereof for capital goods are aimed at 
increasing the precision of the deduction and thereby ensure neutrality of taxation. 
According to the Hoge Raad, those objectives do not seem to preclude a national 
adjustment regime in which the entire initial deduction is adjusted upon the entry 
into use of a capital good.  
8 Next, the Hoge Raad notes that it is inherent to spread adjustment that deviations 
can arise either at the beginning of the adjustment period or in the course of that 
period. When the former occurs – as in the case at hand – if the deduction is not 
corrected in a single step, a financing advantage would arise for the party 
concerned. Conversely, that approach would lead to a financing disadvantage for a 
taxable person who, unlike the party concerned, did not deduct any VAT during 
the acquisition of a capital good but turns out to have a right to full deduction only 
upon entry into use. That approach would not be in line with the abovementioned 
objectives of accurate deduction and neutral taxation. 
9 The Netherlands adjustment regime, by contrast, takes the time of entry into use 
as the assessment date. If it turns out that the actual use at that time deviates from 
the initially intended use, the deduction is corrected in a single step. According to 
the Hoge Raad, there is no question here of a regime prohibited by EU law 
involving a definitive adjustment in a single step, given that, upon a change of the 
use in one of the subsequent adjustment years, a corresponding adjustment of the 
deduction still takes place.  
10 That regime appears more apt at meeting the objectives of the adjustment regime. 
From this, the Hoge Raad concludes that it is all the more reason not to consider 
Article 187 of the 2006 VAT Directive in isolation, but to read it in conjunction 
with Articles 184 to 186, and accordingly interpret that article as meaning that it 
does not preclude the Netherlands adjustment regime. According to the Hoge 
Raad, it is not beyond all reasonable doubt, however, that that is the correct 
interpretation. It is for those reasons that the Hoge Raad refers the first question 
for a preliminary ruling. 
11 Should the first question be answered in the affirmative, the question arises as to 
whether the Netherlands ‘single adjustment’ is accepted as a measure whereby the 
amount of the VAT to be taken into consideration is specified, within the meaning 
of Article 189(b) of the 2006 VAT Directive. If that is not the case, the question 
remains as to whether it is permitted under Article 189(c). First of all, the question 
arises as to whether adjustment without that measure would lead to an unjustified 
STICHTING SCHOONZICHT 
 
5 
advantage for the party concerned.  If so, the question is then whether the ‘single 
adjustment’ can be regarded as an appropriate measure to prevent that. As the 
interpretation of these provisions is not beyond doubt and the CJEU has not yet 
had the opportunity to interpret Article 189(b) and (c) of the 2006 VAT Directive, 
the Hoge Raad refers the second question for a preliminary ruling.