Opinion of the Advocate General — ECLI:EU:C:2016:505
Date: 2016-06-30
Language of the case: German
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling;Reference for a preliminary ruling - decision unnecessary
Origin: Austria

Summary — Judgment of the Court (Third Chamber), 12 October 2016 1. Harmonisation of fiscal legislation — Common system of value added tax — Taxable persons — Economic activities carried out independently within the meaning of Article 4 of Directive 77/388 and Article 9 of Directive 2006/112 — Criteria for assessment (Council Directives 77/388, Art. 4(1) and (4) and 2006/112, Arts 9(1) and 10) 2. Harmonisation of fiscal legislation — Common system of value added tax — Special schemes — Flat-rate scheme applicable to farmers — Civil-law partnerships constituting independent undertakings which are taxable persons for value added tax purposes — Exclusion from that scheme of such companies that have links with a limited company or forming an association of persons with a business size or legal form exceeding the limits of that flat-rate scheme — Lawfulness — Condition (Council Directives 77/388, Art. 25 and 2006/112, Art. 296) 3. Harmonisation of fiscal legislation — Common system of value added tax — Special schemes — Flat-rate scheme applicable to farmers — Tax authorities calling into question the applicability of that flat-rate scheme with retroactive effect — Permissible in the light of the principle of legal certainty — Condition — Observance of the limitation period for action on the part of the tax authorities (Council Directives 77/388 and 2006/112) 1. Article 4(1) and the first subparagraph of Article 4(4) of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, as amended by Directive 2004/66, on the one hand, and the first subparagraph of Article 9(1) and Article 10 of Directive 2006/112 on the common system of value added tax, on the other, must be interpreted as meaning that multiple civil-law partnerships, which conduct themselves outwardly as such and independently in relation to their suppliers, public authorities and, to a certain extent, their customers, and each of which carries out its own production by using for the most part its means of production, but which market a large proportion of their products under a common trade mark through a limited company the shares in which are held by members of those civil-law partnerships and by other members of the family in question, must be regarded as independent undertakings which are taxable persons for value-added-tax (VAT) purposes. In that regard, the terms used in Article 4(1) of the Sixth Directive and in Article 9(1) of Directive 2006/112, in particular the term ‘any person who’, give to the notion of ‘taxable person’ a broad definition focused on independence in the pursuit of an economic activity to the effect that all persons — natural or legal, both public and private, even entities devoid of legal personality — which, in an objective manner, satisfy the criteria set out in that provision must be regarded as being taxable persons for the purposes of VAT. Thus, in order to establish that an economic activity is being carried out in an independent manner, it is necessary to examine whether the person concerned performs his activities in his own name, on his own behalf and under his own responsibility, and whether he bears the economic risk associated with the carrying-out of those activities. In that context, the fact that some degree of cooperation occurs between such civil-law partnerships and a limited company, particularly in relation to the marketing of their products under a common trade mark, cannot suffice to call into question the independence of those civil-law partnerships vis-à-vis that company. (see paras 27, 28, 31, 34, operative part 1) 2. Article 25 of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, as amended by Directive 2004/66, and Article 296 of Directive 2006/112 on the common system of value added tax must be interpreted as not excluding the possibility of refusing the application of the common flat-rate scheme for farmers, laid down in those articles, to multiple civil-law partnerships, regarded as independent undertakings which are taxable persons for VAT purposes and which cooperate with each other, on the ground that a limited company, an association of persons made up of that limited company and members of the civil-law partnerships in question could not be subject to that scheme, on account of the size of its operation or its legal form, even if those civil-law partnerships do not belong to a category of producers excluded from that flat-rate scheme, in so far as they are, owing to their links with that company or one of those associations, materially capable of assuming the administrative burden of the tasks arising from the application of the normal arrangements or the simplified scheme, this being a matter for the referring court to verify. (see para. 46, operative part 2) 3. In the event that the common flat-rate regime for farmers has, in principle, to be excluded for civil-law partnerships marketing their products under a common trade mark and through a limited company, such an exclusion would apply to the period prior to the date on which the appraisal on which it is based took place, provided that that appraisal occurs within the limitation period for action on the part of the tax authority and its effects do not apply retroactively to a date earlier than that on which the legal and factual elements on which it is based occurred. As the principle of legal certainty does not preclude the tax authorities from carrying out, within the limitation period, a assessment relating to the deducted tax or to services already provided and which should have been subject to VAT, such a rule must also prevail when a scheme from which a taxable person for VAT purposes benefits is called into question by the tax authorities, including for a period prior to the date on which such an appraisal is issued. However, this holds true only provided that that appraisal occurs within the limitation period for action on the part of those authorities, and its effects do not apply retroactively to a date earlier than that on which the legal and factual elements on which it is based occurred. In those conditions, the fact that the tax authorities initially granted the benefit of the flat-rate scheme to multiple civil-law partnerships is not capable of having an impact on that calling into question, since the legal and factual elements on which those authorities’ new appraisal is based arose subsequent to that grant and took place within the limitation period for action on their part. (see paras 48-51, operative part 3)