Opinion of the Advocate General — ECLI:EU:C:2012:561
Date: 2012-09-11
Language of the case: Dutch
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling
Origin: Netherlands

Summary — Judgment of the Court (First Chamber), 8 November 2012 1. Harmonisation of fiscal legislation — Common system of value added tax — Taxable transactions — Application of goods for the purposes of the business — Treatment as a supply of goods for consideration — Aim — Goods produced, constructed, extracted or processed in the course of business — Concept (Council Directives 77/388, as amended by Directive 95/7, Art. 5(7)(a), and 2006/112, Art. 18) 2. Harmonisation of fiscal legislation — Common system of value added tax — Taxable transactions — Application of goods for the purposes of the business — Sports pitches belonging to the taxable person and transformed by a third person, applied for the purposes of an exempt economic activity — Treatment as a supply for consideration — Conditions — Taxable amount (Council Directive 77/388, as amended by Council Directive 95/7, Arts 5(7)(a), 11A(1)(b) and 13B(h)) 1. Article 5(7)(a) of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, as amended by Directive 95/7, allows Member States to develop their tax law in such a way that businesses which, owing to the fact that they are engaged in an activity which is exempt from value added tax, cannot deduct the tax that they have paid on acquiring their business goods are not placed at a disadvantage as compared with competitors engaged in the same activity who use goods which they have obtained without paying value added tax, by producing the goods themselves or, more generally, by obtaining them ‘in the course of [their] business’. In order to make those competitors subject to the same tax burden as businesses which have acquired their goods from a third party, Article 5(7)(a) of the Sixth Directive gives Member States the option of treating the application, for the purposes of the exempt activities of the business, of goods obtained in the course of business as a supply of goods made for consideration within the meaning of Article 2(1) and Article 5(1) of that directive, and of making that application subject to value added tax. In order for it to be possible for that option, which was reproduced in Article 18 of Directive 2006/112 on the common system of value added tax, to be used in a way which truly eliminates all inequalities, in relation to value added tax, between taxable persons who have acquired their goods from another taxable person and those who have acquired them in the course of their business, the terms ‘goods produced, constructed, extracted, processed, … in the course of such business’ must be construed as covering not only goods entirely produced, constructed, extracted or processed by the business concerned itself, but also goods constructed, extracted or processed by a third party with materials provided by that business. In order for a taxable person to be subject, consistently with the aim of Article 5(7)(a), to the same tax burden as competitors who carry out the same exempt activity using goods which they have acquired in their entirety from a third party, it must be possible for the treatment option available under that provision to be extended to all goods completed or improved by the third party and, accordingly, to cause value added tax to be levied on the basis of the overall value of those goods. (see paras 26-28) 2. Article 5(7)(a) of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, as amended by Directive 95/7, read in conjunction with Article 11(A)(1)(b) of that directive, must be interpreted as meaning that the application by a taxable person, for the purposes of an economic activity exempt from value added tax, of sports pitches which he owns and which he has had transformed by a third person can be subject to value added tax calculated on the basis of the aggregate arrived at by adding to the transformation costs the value of the ground on which the pitches lie, to the extent that the taxable person has not yet paid the value added tax relating to that value or to those costs, and provided that the pitches at issue are not covered by the exemption provided for in Article 13(B)(h) of the Sixth Directive. In this respect, it is only if the sports pitches can be categorised as land which has been built on, or as building land within the meaning of Article 4(3)(b) of the Sixth Directive that value added tax would be payable on their application for the purposes of the business. Where, pursuant to the option available under Article 5(7)(a) of that directive, the application for the purposes of the business of land which is neither built-on-land nor building land is treated as a supply of that land made for consideration, that treatment causes Article 13(B)(h) of the Sixth Directive to apply, with the result that no value added tax may be levied. (see paras 36, 38, operative part)