Judgment — ECLI:EU:C:2012:759
Date: 2012-11-29
Language of the case: Romanian
Court formation: Third Chamber
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling
Origin: Romania

Summary — Judgment of the Court (Third Chamber), 29 November 2012 1. Harmonisation of fiscal legislation — Common system of value added tax — Taxable persons — Economic activities — Definition — Preparatory economic activities — Included (Council Directive 2006/112, Art. 9(1)) 2. Harmonisation of fiscal legislation — Common system of value added tax — Deduction of input tax — Acquisition of land and buildings constructed on that land, with a view to demolishing the buildings and developing a residential complex — Right to deduction (Council Directive 2006/112, Arts 167 and 168) 3. Harmonisation of fiscal legislation — Common system of value added tax — Deduction of input tax — Adjustment of original deduction — Aim (Council Directive 2006/112, Arts 185 to 187) 4. Harmonisation of fiscal legislation — Common system of value added tax — Deduction of input tax — Adjustment of original deduction — Demolition of buildings carried out with a view to developing a residential complex residential complex in place of those buildings — Demolition envisaged upon acquisition of the buildings — No obligation to make an adjustment (Council Directive 2006/112, Art. 185) 1. See the text of the decision. (see paras 24-27) 2. Articles167 and 168 of Directive 2006/112 on the common system of value added tax must be interpreted as meaning that a company which has acquired land and buildings constructed on that land, for the purpose of demolishing the buildings and developing a residential complex on the land, has the right to deduct the value added tax relating to the acquisition of those buildings, since, in making that acquisition, that company performs an economic activity as a taxable person and that, as soon as it acquired the land and the buildings at issue, the company indicated its intention to demolish the buildings in order to develop a residential complex on that land. Since those buildings were acquired along with the land on which they had been constructed and that land continues to be used by the company for the purposes of its taxed transactions, the replacement of dilapidated structures with more modern buildings and, consequently, their use for taxable output transactions in no way breaks the direct link between, on the one hand, the input acquisition of the buildings at issue and, on the other, the economic activities carried out thereafter by the taxable person. The acquisition of those buildings and their subsequent destruction with a view to building more modern new ones can, therefore, be regarded as a series of linked transactions for the purposes of subsequent taxable transactions in the same way as the acquisition of new buildings and their direct use. (see paras 31-33, 35, 36, operative part 1) 3. See the text of the decision. (see paras 38, 39) 4. Article 185 of Directive 2006/112 on the common system of value added tax must be interpreted as meaning that the demolition of buildings, acquired together with the plot of land on which they were constructed, which is carried out with a view to developing a residential complex in place of those buildings, does not constitute a change within the meaning of Article 185(1) since that demolition was envisaged upon acquisition of the buildings and therefore does not result in an obligation to adjust the initial deduction of the value added tax relating to the acquisition of those buildings. (see paras 41, 42, operative part 2)