Opinion of the Advocate General — ECLI:EU:C:2021:58
Date: 2021-01-21
Language of the case: German
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling
Origin: Austria

Anonymised version 
Translation C-844/19 — 1 
Case C-844/19 
Request for a preliminary ruling 
Date lodged: 
15 November 2019 
Referring court: 
Verwaltungsgerichtshof (Austria) 
Date of the decision to refer: 
24 October 2019 
Appellants on a point of law: 
CS 
Finanzamt Graz-Stadt 
      
[OMISSIS] 
Verwaltungsgerichtshof (Supreme Administrative Court, Austria) 
[OMISSIS] 
24 October 2019   
The Supreme Administrative Court [OMISSIS] (1) in the appeal on a point of law 
bearing the reference Ro 2017/15/0035 brought by CS, residing in … [OMISSIS], 
against the judgment of the Bundesfinanzgericht (Federal Finance Court, Austria) 
of 29 May 2017 [OMISSIS] concerning the rejection of an application for the 
award of appeal-related interest, and (2) in the appeal on a point of law bearing the 
reference Ro 2018/15/0026 brought by the Finanzamt Graz-Stadt (City of Gratz 
Tax Office, Austria), established in Graz, [OMISSIS] against the judgment of the 
Federal Finance Court of 7 September 2018 [OMISSIS] concerning the fixing of 
interest (intervener: technoRent International GmbH, established in Gräfelfing 
(Federal Republic of Germany) [OMISSIS]) made the following 
EN 
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Order: 
The following questions are referred to the Court of Justice of the European Union 
for a preliminary ruling pursuant to Article 267 TFEU: 
1. Is there a rule with direct effect under EU law that grants a taxpayer to 
whom the tax office, in circumstances such as those in the main proceedings, 
has not refunded a turnover tax credit in good time entitlement to interest for 
late payment, with the result that he can claim that entitlement before the tax 
office or before the administrative courts, even though national law does not 
provide for such a rule on interest? 
If Question 1 is answered in the affirmative:  
2. Is it permissible also in the case of a turnover tax claim made by the taxable 
person as a result of a subsequent reduction of consideration under 
Article 90(1) of Council Directive 2006/112/EC of 28 [Or. 2] November 
2006 on the common system of value added tax that interest begins to accrue 
only after expiry of a reasonable period for the tax office to assess the 
lawfulness of the entitlement claimed by the taxable person? 
3. Does the fact that the national law of a Member State does not provide for 
any rule on interest in respect of the late crediting of turnover tax credits 
mean that the national courts must, when calculating interest, apply the legal 
consequence laid down by the second subparagraph of Article 27(2) of 
Council Directive 2008/9/EC of 12 February 2008 laying down detailed 
rules for the refund of value added tax, provided for in Directive 
2006/112/EC, to taxable persons not established in the Member State of 
refund but established in another Member State, even though the main 
proceedings do not fall within the scope of that directive? 
Grounds: 
1 A. Facts and proceedings to date: 
2 1. Appeal on a point of law Ro 2017/15/0035 
3 On 13 September 2007, in his turnover tax return for August 2007, the appellant 
on a point of law, residing in Austria, claimed an input tax surplus in the amount 
of EUR 60 689.28. 
4 The tax office did not register that surplus in the tax account of the appellant on a 
point of law, but carried out a turnover tax assessment. A dispute thereby arose 
over the extent of the input tax deduction from the construction of an extension to 
the hotel business run by the appellant on a point of law. The tax office therefore 
fixed the input tax surplus by decision of 18 October 2007 at EUR 46 000 lower, 
that is, in the amount of EUR 14 689.28. 
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5 The appellant on a point of law brought an appeal against that decision. [Or. 3] 
6 By decision of the Unabhängiger Finanzsenat (Independent Finance Tribunal, 
Austria) of 15 May 2013, the appeal was upheld and the turnover tax was fixed as 
claimed by the appellant on a point of law. The input tax amount was credited to 
the tax account of the appellant on a point of law on 22 May 2013. 
7 By application of 30 May 2013, the appellant on a point of law claimed appeal-
related interest under Paragraph 205a of the Bundesabgabenordnung (Federal Tax 
Code, Austria; BAO) in respect of the tax credit for the period from 1 January 
2012, on the ground that the rule in Paragraph 205a of the BAO entered into force 
on 1 January 2012 and the interpretation of that provision in accordance with EU 
law also gives rise to an entitlement to interest for late payment on input tax 
credits. 
8 The tax office rejected that application by decision of 10 June 2013. 
9 By the judgment under appeal before the Supreme Administrative Court, the 
Federal Finance Court dismissed the appeal brought against the rejection decision. 
10 As reasoning for its decision, the Federal Finance Court stated, in essence, that 
while the provision of Paragraph 205a of the BAO does provide for interest where 
an initially disputed tax liability paid by the taxable person to the tax office is 
reduced as a result of an appeal, it does not so provide for the present case of an 
award of a tax credit in appeal proceedings. 
11 The appellant on a point of law challenges the Federal Finance Court’s decision 
by appeal on a point of law to the Supreme Administrative Court. 
12 The Supreme Administrative Court held a hearing in relation to the appeal on a 
point of law. At the hearing, the appellant on a point of law claimed that EU law 
grants him entitlement to interest for late payment on the input tax credit. The tax 
authority contended that no entitlement to interest for late payment with direct 
effect arises under EU law and that the case-law of the Court of Justice had to date 
always applied in cases in which the national legal order already had a system of 
interest for late payment. [Or. 4] 
13 2. Appeal on a point of law Ro 2018/15/0026 
14 The intervener, a limited liability company with its seat in Germany, sold 
machines in Austria in 2003 and 2004 and paid turnover tax on those transactions 
in Austria. In 2005, in its turnover tax return for the month of May 2005, it 
claimed a turnover tax credit in the amount of EUR 367 081.58 on the ground that 
a reduction of consideration (Paragraph 16 of the UStG 1994) had subsequently 
occurred. 
15 The turnover tax credit was assessed in the course of an assessment by the tax 
authority that began in July 2006 and ended in June 2008 and was credited to the 
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intervener’s tax account during the assessment procedure on 10 March 2008. In 
view of a previously existing debt of EUR 18 000 in the tax account, the 
intervener ended up with a credit of around EUR 345 000. 
16 However, at the end of the assessment, the tax office took the view that the 
adjustment of consideration was not necessary and that the intervener was not 
entitled to turnover tax refund. By decision of 13 October 2008 the tax office 
therefore fixed the turnover tax for 2005 at EUR 2 734.36, which resulted in an 
additional assessment in the amount of EUR 367 081.58. That additional 
assessment was paid by the intervener in part from the existing credit in its tax 
account and in part through a payment to the tax office. 
17 An appeal brought by the intervener against the turnover tax notice of 13 October 
2008 was upheld by the Independent Finance Tribunal by appeal decision of 
8 April 2013. The amount of EUR 367 081.58 was credited to the intervener on 
10 May 2013. 
18 By application of 21 October 2013 the intervener claimed interest on the sum of 
EUR 367 081.58, referring to decisions of the Court of Justice of the European 
Union (inter alia the judgment of 19 July 2012, Littlewoods Retail Ltd, C-591/10). 
[Or. 5] 
19 In respect of that claim, the tax office decided by decision of 4 February 2014 that 
a claim for interest (in the amount of EUR 10 021.32) arose only for the period 
from 1 January 2012 to 8 April 2013. The additional assessment in the amount of 
EUR 367 081.58 fixed by the turnover tax notice of 13 October 2008 was paid to 
the tax office by the intervener. Paragraph 205a of the BAO grants appeal-related 
interest on the tax paid to the tax office during the legal proceedings; 
Paragraph 205a of the BAO entered into force on 1 January 2012. 
20 An appeal brought against the decision of 4 February 2014 was upheld in part by 
the Federal Finance Court by judgment of 29 May 2017, in so far as it awarded 
the intervener interest for late payment also for the period from 2 September 2005 
to 9 March 2008, as a result of which the interest for late payment increased to a 
total of EUR 51 170.02. 
21 For the period from 2 September 2005 to 9 March 2008, the Federal Finance 
Court did not cite Paragraph 205a of the BAO as the basis for its decision on the 
ground that, with regard to that period, none of the taxes paid by the intervener to 
the tax office were available. The Federal Finance Court states EU law and in 
particular the judgment of the Court of Justice of 19 July 2012, Littlewoods Retail 
Ltd, C-591/10 as the basis for entitlement to interest for late payment. The Federal 
Finance Court states that the intervener had no access to the amount of 
EUR 367 081.58 from the date of notice until the credit received on 10 March 
2008. In accordance with the case-law of the Court of Justice, interest applies to 
that period, as a result of which interest began to accrue on the forty-sixth day 
after the filing of the turnover tax return, that is, on 2 September 2005 (judgment 
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of the Court of Justice of 12 May 2011, Enel Maritsa Iztok 3, C-107/10, 
paragraph 61). The fact that the tax authorities carried out an assessment of the 
turnover tax credit does not preclude entitlement to interest. 
22 The intervener had access to the amount of EUR 367 081.58 from 10 March 2008. 
The yearly turnover tax notice for 2005 of 13 October 2008 does not alter the 
foregoing, because the intervener brought an appeal against that notice, with the 
result that, on application, [Or. 6] the payment of the additional assessment of 
EUR 367 081.58 resulting from that notice is suspended under national law 
(Paragraph 212a of the BAO) until delivery of the decision on the appeal and that 
sum of money may be accessed. 
23 The appeal on a point of law brought by the tax office against the decision of the 
Federal Finance Court of 29 May 2017 is directed exclusively against the award 
of interest for late payment for the period from 2 September 2005 to 9 March 
2008. 
24 The Supreme Administrative Court held a hearing in relation to the appeal on a 
point of law. At the hearing, the tax authority contended that no entitlement to 
interest for late payment with direct effect arises under EU law. The national legal 
order in Austria does not lay down — in contrast to the legal order in the main 
proceedings underlying the judgment in Littlewoods Retail Ltd, in which the Court 
of Justice ruled on interest for late payment applying to turnover tax credits in the 
light of EU law — any basis for entitlement to interest for late payment on the tax 
credits at issue in the present case. It may also be inferred from Article 27 of 
Directive 2008/9 that it cannot be challenged under EU law where a Member State 
does not recognise interest on tax credits. 
25 B. Relevant provisions of national law: 
26 As a preliminary point, it should be pointed out that Austrian tax law does not 
provide for any general rules regarding interest on tax debts or tax credits. 
Paragraph 205 of the BAO lays down (for a maximum period of 48 months from 
the October following the tax year) ‘interest on additional assessments’ (granted 
to the tax creditor) and ‘interest on credits’ (granted to the taxable person), which 
may arise on the basis of the difference between the established advance payments 
and the tax amount established in the yearly tax notice, only in the field of income 
tax and corporation tax. In the event that the imposition of a tax leads to an 
additional assessment and the taxable person challenges that additional assessment 
through an appeal, but already [Or. 7] pays it to the tax office during the appeal 
period, and that additional tax assessment is ultimately reduced through disposal 
of the appeal, Paragraph 205a of the BAO provides for appeal-related interest for 
the period from payment until notification of the disposal of the appeal that 
reduces the tax. 
27 The Austrian Umsatzsteuergesetz (Law on turnover tax; ‘UStG 1994’) provides, 
inter alia, in Paragraph 21(1) that a surplus (in input tax compared with turnover 
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tax) notified in advance within the advance notification period (one calendar 
month) is — generally — to be credited promptly to the taxable person’s tax 
account, as a result of which the credit takes effect from the date of lodging the 
advance notification, at the earliest from the date following expiry of the advance 
notification period, and immediately extinguishes tax debts declared in the tax 
account or is available for payments to the taxable person. Interest on any credit in 
the tax account stemming from the credit entry is not provided for. 
28 Paragraph 217 of the Federal Tax Code provides for late payment surcharges in 
the event that a tax is not paid at the latest on the due date. The first late payment 
surcharge amounts to 2% of the tax amount not paid in due time; a second and 
third late payment surcharge (each in the amount of 1%) must be paid after a 
further three months in each case. 
29 In respect of operators not established in the territory of the country and also not 
generating any turnover in the territory of the country, the Verordnung des 
Bundesministers für Finanzen (Regulation of the Austrian Federal Minister for 
Finance), BGBl. No 279/1995 (in the version under BGBl. II No 158/2014), 
which transposes Council Directive 2008/9/EC of 12 February 2008 laying down 
detailed rules for the refund of value added tax, provided for in Directive 
2006/112/EC, to taxable persons not established in the Member State of refund 
but established in another Member State, provides for the refund of input tax in a 
separate procedure. As regards operators established elsewhere in the territory of 
the Community, Paragraph 3 of that regulation provides for late payment 
compensation: if no payment of the amount to be refunded is made by the tax 
office upon expiry of a period of four months and ten working days from the date 
of [Or. 8] receipt of the refund application by the tax authorities, late payment 
compensation is to be fixed in the amount of 2% for the tax amount not refunded 
in due time. If the tax authority requests additional information, entitlement to late 
payment compensation exists, where a single request is made, at the earliest ten 
working days after expiry of a period of six months and, where two requests are 
made, at the earliest ten working days after expiry of a period of eight months 
from the date of receipt of the refund application. Secondary and tertiary awards 
of late payment compensation (each amounting to 1% of the non-refunded tax 
amount) are to be fixed in so far as the tax amount is not refunded at the latest 
after three further months in each case. 
30 C. Explanation of the questions referred: 
31 1. Principles governing entitlement to interest for late payment with direct effect 
under EU law 
32 The pending appeal on a point of law bearing the reference Ro 2017/15/0035 
concerns a late refund of an input tax surplus. 
33 In the judgments of 12 May 2011, Enel Maritsa Iztok 3, C-107/10; 24 October 
2013, Rafinăria Steaua Română, C-431/12; of 6 July 2017, Glencore Agriculture, 
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C-254/16; and of 28 February 2018, Nidera BV, C-387/16, the Court of Justice 
ruled, regarding the interpretation of Article 183 of the VAT Directive in cases of 
input tax surpluses, that the taxable person is to be paid interest for late payment if 
a VAT surplus is not paid to him within a reasonable period. A common feature of 
the main proceedings underlying the judgments of the Court of Justice cited is that 
the respective legal orders provide for rules according to which the State was 
under an obligation to pay interest for late payment to the taxable person in the 
event of an unlawfully late tax refund. There is no such provision in Austrian 
national law. There are no legislative provisions that award the taxable person 
interest for late payment for the late refund of turnover tax claims. The provisions 
of Paragraph 205 and Paragraph 205a of the BAO occasionally referred to in the 
literature are not applicable [Or. 9] in such a case. Both the wording of those 
provisions and their objective and general scheme exclude their application to late 
turnover tax refunds (see the judgment of the Supreme Administrative Court of 
31 March 2017, Ra 2016/13/0034). 
34 Given that national law grants no entitlement to interest, the question arises as to 
whether EU law, in particular Article 183 of the VAT Directive, provides for a 
rule with direct effect on which the taxable person may rely before the tax office 
and before the courts in order to receive interest for late payment on account of 
late refunds of input tax surpluses. 
35 In that regard, it must be borne in mind that Article 27 of Directive 2008/9 (see, to 
that effect, section 3 below) lays down rules in the event that the national law of a 
Member State does not recognise such interest. Accordingly, Article 27 of 
Directive 2008/9 does not operate on the assumption that the taxable person must 
necessarily be granted entitlement to interest for late payment under EU law. If, in 
any event, EU law already provided for entitlement to interest for late payment, 
the second subparagraph of Article 27(2) of Directive 2008/9 would be rendered 
meaningless (see, albeit concerning Article 26(2) of that directive, judgment of the 
Court of Justice of 2 May 2019, Sea Chefs Cruise, C-133/18, paragraph 45). 
36 The pending appeal on a point of law bearing the reference Ro 2018/15/0026 does 
not concern an input tax surplus and cannot be ruled upon under Article 183 of the 
VAT Directive. The proceedings concern a turnover tax claim made by the 
taxable person against the tax office that arose from a subsequent reduction of 
consideration. Under the provisions of Paragraph 16(1) and (3) of the UStG 1994 
which transpose Article 90(1) of the VAT Directive, the operator that generated 
turnover in the past must reduce the tax amount owed for that turnover if the 
agreed purchase price is subsequently reduced or becomes irrecoverable. Under 
Paragraph 16(1) of the UStG 1994, the adjustment is to be made for the taxable 
period in which the change in consideration occurred; thus, in the present case, in 
the taxable period in which the claim for the purchase price became irrecoverable 
(May 2005). [Or. 10] 
37 As far as can be seen, the Court of Justice has addressed the question of interest 
for late payment in respect of turnover tax claims made by the operator that are 
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not based on an input tax surplus but on other circumstances only in the judgment 
of 19 July 2012, Littlewoods Retail Ltd, C-591/10, in which it is also significant 
for the main proceedings underlying that judgment that national law already 
provided for rules on interest for late payment for corresponding tax credits. That 
judgment concerns a turnover tax claim based on consideration (purchase prices 
for goods) that was wrongly calculated too high in the past. In that judgment, the 
Court of Justice based entitlement to interest for late payment from its case-law on 
the refund of ‘charges levied in breach of EU law’ (see the judgment in 
Littlewoods Retail Ltd, paragraph 24). 
38 In the appeal on a point of law Ro 2018/15/0026 the question arises whether a 
subsequently occurring reduction of consideration, here in the form of claims for 
the purchase price subsequently being declared irrecoverable, may be deemed a 
case of a ‘charge levied in breach of EU law’. Should the Court of Justice’s case-
law on ‘taxes levied in breach of EU law’ be applicable to such a case, the further 
question arises as to whether there is a rule of EU law with direct effect that grants 
a taxable person to whom the tax office, in circumstances such as those in the 
main proceedings, has not refunded a turnover tax credit in good time entitlement 
to interest for late payment, with the result that he can claim that entitlement 
before the tax office or before the administrative courts, even though national law 
does not recognise interest for late payment for comparable tax credits. 
39 2. Point from which interest begins to accrue 
40 Should the taxable person be entitled with direct effect under EU law to interest 
for late payment by the tax office, the question arises as to the point in time from 
which interest is to be calculated. In the judgments in Enel Maritsa Iztok 3, 
Rafinăria Steaua Română, Glencore Agriculture and Nidera BV, which concern 
interest for late payment in relation to the late crediting of input tax surpluses and, 
accordingly, the interpretation of Article 183 of the [Or. 11] VAT Directive, the 
Court of Justice ruled that interest begins to accrue only after expiry of a 
reasonable period, which is provided to the tax office for the purposes of assessing 
the lawfulness of the input tax claim. 
41 Concerning interest for late payment on turnover tax claims made by the taxable 
person that are not based on input tax surpluses, there is only the Court of 
Justice’s judgment in Littlewoods Retail Ltd. That judgment sheds no light as to 
when interest begins to accrue. The judgment refers — as previously 
mentioned — to the Court of Justice’s case-law on ‘taxes levied in breach of EU 
law’, which — as far as can be ascertained — does not state that interest should 
begin to accrue only after expiry of a reasonable period. In the Supreme 
Administrative Court’s view, it would, however, be appropriate to apply the Court 
of Justice’s statements on the point from which interest begins to accrue in respect 
of input tax surpluses under Article 183 of the VAT Directive also to cases in 
which the turnover tax claim made by the taxable person against the tax office is 
not based on input tax surpluses. In those cases too, a reasonable period must be 
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available to the tax office for assessing the lawfulness of the claim made by the 
taxable person in order to ensure the proper implementation of the VAT Directive. 
42 Also in connection with the point from which interest begins to accrue, the 
relationship with Directive 2008/9 (see, to that effect, section 3) has not yet been 
sufficiently clarified. 
43 3. Relationship with Council Directive 2008/9/EC of 12 February 2008 
44 Should the Court of Justice come to the conclusion that entitlement to interest for 
late payment arises with direct effect under EU law, the referring court will need 
to determine how that entitlement is to be implemented. In that regard, various 
legal principles under national law can be taken into account, as a result of which 
the relationship with Directive 2008/9 is unclear. 
45 Article 27 of Directive 2008/9 does not provide for any rules on  interest for late 
payment in the event of a late refund of input tax. In that regard, the second 
subparagraph of Article 27(2) [Or. 12] provides: ‘If no interest is payable under 
national law in respect of refunds to established taxable persons’, the rules 
provided for by the Member State for late payments of VAT by taxable persons 
are to be applied accordingly. 
46 It follows from Article 27 of Directive 2008/9 that the EU legislature provides for 
the possibility that the national law of the Member State does not lay down a 
system of interest. The EU legislature therefore does not consider such a legal 
situation to be contrary to EU law a priori, but provides that in such a situation, 
the Member State’s system for late payment is to be applied mutatis mutandis. In 
any event, the EU legislature proceeds on the basis that, without the rule in 
Article 27 of Directive 2008/9, the taxable person established in another Member 
State has no entitlement to interest for late payment, if national law does not 
already grant such entitlement. 
47 Austrian national law does not lay down any rules on interest regarding the late 
crediting of turnover tax credits. The question therefore arises whether that means 
that the national courts should apply the legal consequence laid down by the 
second subparagraph of Article 27(2) of Directive 2008/9 even though the main 
proceedings do not fall within the scope of that directive. The application of the 
second subparagraph of Article 27(2) would mean for Austria that interest would 
accrue at a flat rate with a first late payment surcharge of 2% and a second and 
third late payment surcharge of 1% each time, but no additional interest. 
48 Directive 2008/9 also sets out, in Articles 19, 21 and 22, periods that are granted 
to the tax office to assess the lawfulness of the input tax claimed. Under Article 27 
of the directive, the period in which interest is payable begins only after those 
periods have expired. The referring court harbours doubts as to whether the 
periods provided for in that directive are also to be applied to cases such as the 
main proceedings, that is, to cases that are not directly covered by the directive. 
[Or. 13] 
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49 Overall, the interpretation of EU law in relation to the questions set out above 
does not appear to be so obvious as to leave no scope for doubt within the 
meaning of the judgment in CILFIT (Court of Justice, 6 October 1982, 283/81). 
50 The questions are therefore referred to the Court of Justice for a preliminary ruling 
pursuant to Article 267 TFEU. 
[OMISSIS]