Provisional text
OPINION OF ADVOCATE GENERAL
KOKOTT
delivered on 11 September 2025 (1)
Case C‑472/24
‘Žaidimų valiuta’ MB
v
Valstybinė mokesčių inspekcija prie Lietuvos Respublikos finansų ministerijos
(Request for a preliminary ruling from the Mokestinių ginčų komisija prie Lietuvos Respublikos Vyriausybės (Tax Disputes Commission under the Government of the Republic of Lithuania))
( Reference for a preliminary ruling – Common system of value added tax (VAT) – Directive 2006/112/EC – Exemption – Article 135(1)(e) – Sale of in-game Gold for real money outside the game – Transactions concerning legal tender – Calculation of the taxable amount – Article 30b(2) – In-game Gold as a voucher – Margin scheme – Article 315 – In-game Gold as second-hand goods )
I.      Introduction
‘Gold all doth lure, Gold doth secure all things. Alas, we poor!’ (2)
1.        In the present case, the Court has an opportunity to deal with the way in which an entirely new form of gold trading is considered for VAT purposes. A taxable person has managed to ‘turn to gold’ a ‘currency’ designed for an online computer game, in-game Gold, outside the game by purchasing it from players and reselling it to other players. The resulting transactions were not insignificant;
however, VAT was forgotten. It is now to be levied retrospectively.
2.        The taxable person is now trying to convince the tax authority either to consider its ‘gold trading’ – which consists, for VAT purposes, in the purchase and sale of electronic services – an exempt ‘currency transaction’ or at least to regard in-game Gold as a multi-purpose voucher. If
the latter were the case, tax consequences would arise only when in-game Gold is redeemed in the game. In any event, only the profit margin, as remuneration for the ‘exchange of currencies’, would have
to be taxed.
3.        At the same time, the interesting question arises whether the application of the ‘margin scheme’, which, according to the wording of the relevant provision, covers only trade in second-hand goods, can still in reality be contingent on the historical differentiation between the supply of goods and the supply of services if, as a result of technological developments, services are now also traded in the same way as goods. That applies to objects in a computer game (which, from a VAT perspective, are electronic services) as well as, for example, to the trade in electronic works of art using non-fungible tokens (NFTs) or in admission tickets (which are likewise to be considered services for VAT purposes).
II.    Legal framework
A.      European Union law
4.        The legal framework is provided by Directive 2006/112/EC on the common system of value added tax (3) (‘the VAT Directive’).
5.        Article 135(1)(e) of the VAT Directive provides:
‘1.      Member States shall exempt the following transactions:
…
(e)      transactions, including negotiation, concerning currency, bank notes and coins used as legal tender, with the exception of collectors’ items, that is to say, gold, silver or other metal coins or bank notes which are not normally used as legal tender or coins of numismatic interest;’
6.        Article 30a of the VAT Directive reads as follows:
‘For the purposes of this Directive, the following definitions shall apply:
(1)      “voucher” means an instrument where there is an obligation to accept it as consideration or part consideration for a supply of goods or services and where the goods or services to be supplied or the identities of their potential suppliers are either indicated on the instrument itself or in related documentation, including the terms and conditions of use of such instrument;
(2)      “single-purpose voucher” means a voucher where the place of supply of the goods or services to which the voucher relates, and the VAT due on those goods or services, are known at the time of issue of the voucher;
(3)      “multi-purpose voucher” means a voucher, other than a single-purpose voucher.’
7.        Article 30b(2) of the VAT Directive provides:
‘2.      The actual handing over of the goods or the actual provision of the services in return for a multi-purpose voucher accepted as consideration or part consideration by the supplier shall be subject to VAT pursuant to Article 2, whereas each preceding transfer of that multi-purpose voucher shall not be subject to VAT.
Where a transfer of a multi-purpose voucher is made by a taxable person other than the taxable person carrying out the transaction subject to VAT pursuant to the first subparagraph, any supply of services that can be identified, such as distribution or promotion services, shall be subject to VAT.’
8.        With regard to the purchase and sale of second-hand goods, the directive provides for special schemes. Article 311(1)(1) and (5) defines second-hand goods and dealer as follows:
‘1.      For the purposes of this Chapter, and without prejudice to other Community provisions, the following definitions shall apply:
1.      “second-hand goods” means movable tangible property that is suitable for further use as it is or after repair, other than works of art, collectors’ items or antiques and other than precious metals or precious stones as defined by the Member States;
…
5.      “taxable dealer” means any taxable person who, in the course of his economic activity and with a view to resale, purchases, or applies for the purposes of his business, or imports, second-hand goods, works of art, collectors’ items or antiques, whether that taxable person is acting for himself or on behalf of another person pursuant to a contract under which commission is payable on purchase or sale;’
9.        Under Article 313(1) of the directive:
‘In respect of the supply of second-hand goods, works of art, collectors’ items or antiques carried out by taxable dealers, Member States shall apply a special scheme for taxing the profit margin made by the taxable dealer, in accordance with the provisions of this Subsection.’
10.      Article 314 of the VAT Directive provides:
‘The margin scheme shall apply to the supply by a taxable dealer of second-hand goods, works of art, collectors’ items or antiques where those goods have been supplied to him within the Community by one of the following persons:
(a)      a non-taxable person;
…
(d)      another taxable dealer, in so far as VAT has been applied to the supply of goods by that other taxable dealer in accordance with this margin scheme.’
11.      Article 315 of the VAT Directive governs the taxable amount in the context of the margin scheme and provides:
‘The taxable amount in respect of the supply of goods as referred to in Article 314 shall be the profit margin made by the taxable dealer, less the amount of VAT relating to the profit margin.
The profit margin of the taxable dealer shall be equal to the difference between the selling price charged by the taxable dealer for the goods and the purchase price.’
12.      It is further stated in recital 51 of the VAT Directive:
‘It is appropriate to adopt a Community taxation system to be applied to second-hand goods, works of art, antiques and collectors’ items, with a view to preventing double taxation and the distortion of competition as between taxable persons.’
B.      Lithuanian law
13.      Under paragraph 4 of Article 28 (entitled ‘Financial services’) of the Lietuvos Respublikos pridėtinės vertės mokesčio įstatymas (Law of the Republic of Lithuania on value added tax; ‘the Law on VAT’), currency transactions (including currency exchange), as well as cash deposits and payments, cash management and other services directly connected with bank notes and coins of any currency, are to be exempt from VAT.
14.      Article 71(2) of the Law on VAT fixes the Lithuanian small business threshold at EUR 45 000.
15.      Under Article 2(22) of the Law on VAT, goods means any item (including bank notes and coins of numismatic interest), as well as electricity, gas, heat, cooling and other types of energy. A computer storage medium is not to be regarded as goods if its content consists of non-standard software, that is to say, software that has not been developed for mass consumption and that consumers would not be able to use independently after installation and the limited training required to perform standard operations or functions.
16.      Article 15(1) of the Law on VAT transposes Article 73 of the VAT Directive and provides that the taxable amount which is the base for the calculation of VAT is to comprise the consideration (excluding the VAT itself) which has been or is to be received by the supplier of goods or services or by a third party on behalf of that supplier.
17.      Article 2(131), Article 2(71) and Article 91(3) and (4) of the Law on VAT transpose the provisions governing vouchers in Articles 30a and 30b of the VAT Directive.
III. Facts
18.      ‘Žaidimų valiuta’ (‘the applicant’) – a mažoji bendrija (small partnership) – is active in virtual ‘gold trading’. It purchases and sells ‘gold’ from an online computer game (‘in-game Gold’).
19.      According to the applicant, in-game Gold can be used in many different ways. It can be used to purchase a variety of services and items in the game, to pay for player status upgrades or for access to in-game events and mini-games, or to purchase gold and items from other games. All of those can be purchased both from other players and from various traders, intermediaries and exchanges. The majority of customers are natural persons. The applicant posts on various forums, groups and platforms such as Facebook, Discord and Skype where most people play online games. An advertisement is created to announce that in-game Gold is for sale, indicating prices and contacts.
20.      To purchase in-game Gold, the customer contacts the communication platforms, specifies the desired quantity, is informed of prices and payment details and, upon payment, is referred to a specific location in the game where that player can collect the in-game Gold after logging in to the game. To sell in-game Gold, the customer is also informed of a location in the game where, after logging in to the game and handing over the in-game Gold, the payment is effected according to the payment details provided by the seller.
21.      During an inspection, the Panevėžio apskrities valstybinė mokesčių inspekcija (Panevėžys District State Tax Inspectorate; ‘the tax authority’) established that the applicant derives significant income from purchasing in-game Gold and reselling it at a higher price. For the period in question, that is to say, between 2020 and 2023, income from the sale of in-game Gold amounting to EUR 199 580 in 2021, EUR 163 428 in 2022 and EUR 52 476 in 2023 was established.
22.      Since the total annual amount of consideration received by the applicant within the preceding 12 months
in the context of its economic activity consisting of
the sale of in-game Gold exceeded EUR 45 000, the applicant became liable to pay VAT. Because it had failed to do so, by decision of 9 January 2024, the applicant was ordered to pay VAT in the amount of EUR 46 688 (EUR 16 270 for 2021, EUR 21 351 for 2022 and EUR 9 067 for 2023). At the same time, however, a loss of EUR 12 327 was also established for the 2021 tax period and a loss of EUR 21 843 for the 2022 tax period.
23.      The applicant disagreed with the decision of the tax authority and lodged a complaint with the Mokestinių ginčų komisija prie Lietuvos Respublikos Vyriausybės (Tax Disputes Commission under the Government of the Republic of Lithuania; ‘the Tax Disputes Commission’).
24.      The applicant states that the income from the sale of in-game Gold is income from trading in virtual currencies and is therefore exempt from VAT. According to the applicant, if it is not a virtual currency, then in-game Gold should be regarded as a multi-purpose voucher, which is not subject to VAT. In any event, it states that the entire value of the transaction involving in-game Gold cannot be treated as the taxable value for VAT purposes. Given that the applicant does not charge a separate commission fee for the sale of in-game Gold, the taxable value for VAT purposes should consist in the difference between the purchase price and the selling price of the in-game Gold.
IV.    Request for a preliminary ruling
25.      The Mokestinių ginčų komisija prie Lietuvos Respublikos Vyriausybės (Tax Disputes Commission) decided to stay the proceedings and to refer the following two questions to the Court:
‘(1)      Does the sale of “Gold” from the game “Runescape” fall within the scope of the exempt transactions set out in Article 135(1)(e) of [the VAT Directive]?
(2)      If the answer to the first question is in the negative, what should be the taxable value of in-game Gold according to the provisions of the VAT Directive: the total consideration for the sale of in-game Gold or only the difference between the purchase price and the selling price, where the trader does not charge a separate commission for the transfer of in-game Gold?’
26.      In the proceedings before the Court, only the applicant, Lithuania and the European Commission have submitted written observations. In accordance with Article 76(2) of the Rules of Procedure, the Court did not consider it necessary to hold a hearing.
V.      Legal assessment
A.      Admissibility of the request for a preliminary ruling
27.      The request for a preliminary ruling has been made by the Tax Disputes Commission under the Government of the Republic of Lithuania, which is a body that examines tax disputes before they are brought before the courts. As its name indicates, it is a body attached to the government and thus part of the executive. As grounds for its entitlement to make a reference, the Tax Disputes Commission states that, in 2010, the Court of Justice ruled that it is a court or tribunal entitled to make a reference, within the meaning of Article 267 TFEU. (4) However, the Court of Justice had also made a finding to that effect in 2000 with regard to the Tribunal Económico-Administrativo Central (Central Tax Tribunal, Spain), (5) which, however, the Grand Chamber corrected in 2020. (6) That also makes the reference to the old decision concerning the Lithuanian Tax Disputes Commission, dating from 2010, less convincing.
28.      In the light of the decision of the Grand Chamber from 2020, which does, nevertheless, relate to the Spanish situation, there are significant doubts whether a commission attached to a government is entitled to make a reference in proceedings under Article 267 TFEU. As part of the executive which is involved solely in the pre-litigation procedure, such a commission would not, in principle, be an (independent) court or tribunal entitled to make a reference. (7) However, none of the parties has expressed any doubts regarding the entitlement to make a reference. The Court therefore does not have any new, precise information regarding the Tax Disputes Commission in Lithuania. For that reason, I am bound to proceed on the assumption, in answering the questions referred for a preliminary ruling, that the Tax Disputes Commission is entitled to make a reference.
B.      The course of the investigation
29.      By the first question, the referring commission in essence asks for an interpretation of the exemption under Article 135(1)(e) of the VAT Directive (Section C.).
30.      In the event that the exemption is not relevant, the referring commission asks about the taxable amount for the sale of in-game Gold. Unfortunately, the second question does not contain any rule of EU law for the Court to interpret. Because the referring commission has also cited, as regards the legal framework, rules relating to vouchers, the question could be understood as seeking to ascertain how Articles 30a and 30b of the VAT Directive are to be interpreted with a view to being able to decide whether in-game Gold is to be considered a voucher within the meaning of the VAT Directive (Section D.).
31.      However, the second question also specifically asks whether the total consideration or only the difference between the purchase price and the selling price should be regarded as the taxable amount for the sale of in-game Gold, where the trader does not charge a separate commission fee for the transfer of in-game Gold. As taxation of the difference between the purchase price and the selling price is expressly regulated in Article 311 et seq. of the VAT Directive, the question could also be understood to mean that the referring commission is asking for an interpretation of the concept of second-hand goods within the meaning of Article 311(1)(1) of the VAT Directive. That would be the more interesting question because only the supply of goods normally comes within the scope of the margin scheme, while the in-game Gold (unlike real gold) does not amount to goods but has been traded in the same way as goods (Section E.).
C.      The exemption under Article 135(1)(e)
32.      Article 135(1)(e) of the VAT Directive exempts transactions, including negotiation, concerning currency, bank notes and coins used as legal tender. If the applicant’s transactions involving in-game Gold are to be covered by the exemption, in-game Gold would have to be legal tender. That can be clearly ruled out, however, as the Commission and Lithuania have asserted.
33.      In the judgment in Hedqvist, (8) the Court did extend the concept of legal tender to bitcoins. They were not being used as legal tender anywhere, at least at that time. However, since they could be used as a means of payment in Sweden, there are significant differences between bitcoins at that time and in-game Gold now.
34.      It is true that, as I explained at that time, (9) it is not clear from the various language versions of the VAT Directive whether the exemption relates only to the exchange of two legal tenders or whether it is sufficient that one legal tender is involved and the exchange concerns one non-legal tender.
35.      The objective of the exemption for transactions concerning means of payment is not to impede the convertibility of means of payment by levying VAT. (10) That is also of significance in relation to the single market. In so far as cross-border services require the customer to exchange currencies, the levying of VAT on the exchange service increases the price of a cross-border service even further.
36.      According to the Court, the objective of the exemptions in Article 135 of the VAT Directive should be evident from the Court’s case-law, according to which the purpose of the exemptions laid down in Article 135(1)(d) to (f) of the VAT Directive is, inter alia, to alleviate the difficulties connected with determining the taxable amount and the amount of VAT deductible. (11) That may be true, but it does not justify the inclusion of ‘private means of payment’. In fact, the opposite is the case.
37.      The legislature wished to promote smooth payment transactions. However, in doing so, it seems to have used as the basis the system of payment transactions existing at that time, and thus a system of payment transactions regulated by law. It is not really clear why, when the directive was adopted, the Member States should have had an interest in giving privileged status to exchanges in unregulated, alternative means of payment created by private individuals. Nor is that required by the principle of neutrality, as legal tender and ‘objects’ defined by private individuals as means of payment (whether it be cocoa beans as was once the case in South America, or electronic numerical sequences of zeroes and ones today) are different things the exchange of which may also be treated differently for VAT purposes.
38.      Nevertheless, the Court has extended the legislature’s choice (‘legal tender’), for which there are historical reasons and which is warranted from the perspective of legal certainty, by way of an imprecise legal concept (‘means of payment accepted by the parties’). (12) That is understandable in so far as at that time the referring court had made the finding, which was binding on the Court of Justice, that the bitcoin ‘virtual currency’ was used in Sweden, principally, for payments made between private individuals via the internet. Bitcoin was one of the so-called virtual currencies with bidirectional flow, which were analogous to other convertible currencies as regards their use in the real world. (13)
39.      Since the Court expressly substantiated its decision with the argument that, in the case in those main proceedings, it was common ground that the ‘bitcoin’ virtual currency had no other purpose than to be a means of payment and that it was accepted for that purpose by certain operators, (14) that should also be the limit of that extension of the exemption on the basis of a narrow interpretation.
40.      That extension therefore covers at most those virtual currencies that are accepted, like ‘bitcoin’, as a contractual direct means of payment between operators and which have no other purpose than to be a means of payment. However, as the Commission also correctly asserts, there can be no question of use solely
as a means of payment where a ‘currency’ is used only within a game. In that case, it is not a means of payment, but merely a means within the game, that is to say, play money. The use of play money within a game, even if it acts as a currency or a means of payment there, cannot be equated to use as a means of payment between operators in legal transactions.
41.      Consequently, Article 135(1)(e) of the VAT Directive must be interpreted as meaning that it exempts only transactions concerning, first, legal tender and, second, non-legal tender that is accepted as a contractual direct means of payment between operators and thus has no other purpose than to be a means of payment in legal transactions.
D.      In-game gold as a voucher within the meaning of Article 30a?
42.      As the answer to the first question is in the negative, it is necessary to answer the second question. As has already been stated, the second question unfortunately does not contain any rule of EU law for the Court to interpret. In view of the fact that the applicant has claimed,
in its defence, the existence of a multi-purpose voucher, the question could be construed to the effect that an interpretation of
Articles 30a and 30b of the VAT Directive is sought, with a view to being able to decide whether in-game Gold is to be considered a voucher within the meaning of the VAT Directive.
43.      The reason for that is that, under Article 30b(2) of the VAT Directive, the issue and transfer of a multi-purpose voucher gives rise to VAT consequences only when it is redeemed. The prerequisite for that, however, is that in-game Gold may be considered a voucher within the meaning of Article 30a of the VAT Directive. To that end, two cumulative conditions must be met. (15) First, the goods to be supplied or the potential supplier must be apparent from the voucher or its terms and conditions. That would appear to be the case with in-game Gold just as little as with a typical means of payment. In any case, the order for reference does not contain any information in that regard.
44.      Second, in-game Gold would have to give rise to the obligation to accept it as consideration for a service. The purpose of a voucher is to ‘document’ a taxable person’s obligation to supply (in the present case) a service. That too seems doubtful as in-game Gold itself is already an electronic service (a specific benefit in the game which can be used there and played with there), as Lithuania correctly asserts. In that regard, the purchase of in-game Gold in the game (assuming it is possible there – the order for reference also does not contain any information in that respect) should rightly be subject to VAT, provided the place of supply of the service is within the European Union. In-game Gold itself is therefore already the consumable benefit and does not merely serve to procure a later consumable benefit in the form of an as yet unspecified service. The mere fact that a service (in-game Gold) can be exchanged for another (such as an item like a ‘magic sword’) – in the present case, within the game – does not make the service that has already been supplied a voucher.
45.      Ultimately, as I have stated in my Opinion in Lyko Operations (C‑436/24), (16) a voucher must at least have been purchased from the issuer for a specifiable value. That would also not appear to be the case here with in-game Gold. However, the order for reference is not very precise in that regard as the origin of in-game Gold remains unclear and it would also be conceivable – an aspect which the Commission ignores in its observations – that in-game Gold can be purchased for consideration in the game (so-called in-app purchase). In the present case, in-game Gold is probably not primarily purchased but earned. Even if in-game Gold could be purchased for consideration, as has already been stated, the acquisition of an electronic service for consideration does not make it a voucher.
46.      Accordingly, Article 30b(2) of the VAT Directive is not relevant.
E.      Application of the margin scheme under Article 311 et seq.
1.      Explanation of the problem
47.      By the last question, the referring commission nevertheless raises a problem which is interesting from a doctrinal point of view, inasmuch as a regular trader, which purchases and sells goods pays tax, in principle – VAT is intended to be neutral for that trader – only on the added value created by the trader (that is, the margin between the purchases and the sales). That is achieved through deduction of input VAT, which is why, for example, an undertaking that sells its goods below the purchase price is ultimately not required to pay any VAT.
48.      That would not be the case with the applicant, however, as, with its ‘gold trading’, it is active in a sector dominated by non-taxable persons and their goods. The right to deduct exists only in relation to acquisitions
from a taxable person (Article 168(a) of the VAT Directive). If in-game Gold is purchased (from a non-taxable person) for 100 and sold for 90, the applicant
would have,
pursuant to Article 73 of the VAT Directive, to subtract the
VAT
from the 90 received and pay it (in Lithuania, where a tax rate of 21% applies, in the amount of 21/121). Even if it was sold for 120, VAT would have to be subtracted from the 120, which, at the VAT rate of 21% applicable in Lithuania, would result in the applicant making a loss on the sale. The only possible way of avoiding that would be to sell in-game Gold which was purchased for 100 for at least 122 so as to make at least a small profit. In such a case, however, it is likely that no player would acquire in-game Gold from the applicant, but would earn it himself or herself or buy it from another player (who is not a taxable person) without VAT being charged.
49.      There is therefore a competitive disadvantage for a taxable person (trader), which makes it practically impossible to trade successfully in those goods in that person’s own name. If the Court were therefore to conclude that the total consideration should be the taxable amount, it is likely that the applicant’s ‘gold trading’ will soon be history. It could then operate at best as an intermediary between buyers and sellers, as in that case tax is charged only on the commission fee (provided that it thereby exceeds the small business threshold).
50.      That problem (displacement of private trading) is nothing new, however, and is addressed in the VAT Directive by the margin scheme in Article 311 et seq.. The market in second-hand goods exhibits, in essence, precisely those problems. Goods are traded which originate from private sellers and could also be acquired by consumers from those private sellers. Consequently, if a trader wishes to sell goods to other private individuals on its own account, it faces such a great competitive disadvantage that the legislature grants it, rather than deduction of input tax (which exists only for purchases from a taxable person), a deduction of the amount of the input transaction.
51.      Under the margin scheme, a trader can thus deduct the amount of its input transaction from the amount of its output transaction in relation to second-hand goods traded by it and is thus required to pay tax only on its profit margin. That prevents double taxation, (17) first, as only the added value the trader has created itself (the margin) is subject to additional VAT. Second, it reduces the competitive disadvantage as compared to private sellers, since additional VAT is charged only on the added value created by the trader.
52.      In view of the fact that the applicant wishes for its profit margin at most to be taxed and expressly submits in its written observations that it is not entitled to deduct input tax, the question could therefore also be understood as seeking an interpretation of
Article 311 et seq. of the VAT Directive. In that case, it would have to be decided whether in-game Gold may be treated as second-hand goods within the meaning of Article 311(1)(1) and the applicant may be treated as a dealer within the meaning of Article 311(1)(5), with the result that only the profit margin is subject to VAT.
2.      Interpretation of the wording
53.      First, the applicant would have to be considered to be a dealer. Under Article 311(1)(5) of the VAT Directive, a taxable dealer means ‘any taxable person who, in the course of his economic activity and with a view to resale, purchases, or applies for the purposes of his business, or imports, second-hand goods, works of art, collectors’ items or antiques, whether that taxable person is acting for himself or on behalf of another person pursuant to a contract under which commission is payable on purchase or sale’.
54.      Even though the margin scheme constitutes an exception to normal taxation, in the view of the Court, (18) the ‘rule of strict interpretation does not mean that the terms used to set out that arrangement should be construed in such a way as to deprive it of its effects. In fact, the interpretation of those terms must conform
to the objectives pursued by the arrangement and respect the requirements of tax neutrality.’
55.      The Court (19) has therefore correctly given a broad interpretation to the concept of dealer, according to which the second-hand goods do not habitually have to be purchased from the dealer. It is doubtful, on the other hand, whether resale must, in principle, form part of the normal business of the dealer. (20) A court can hardly assess what forms part of the normal business of a taxable person, as that is a primary business decision. That does not have to be clarified in the present case, however, as the sale of in-game Gold appears to form part of the normal business of the applicant.
56.      Furthermore, in-game Gold would have to be second-hand goods within the meaning of Article 311(1)(1) of the VAT Directive. The concept of second-hand goods has likewise been given a broad interpretation, (21) as it is irrelevant for the purposes of the margin scheme whether new, slightly used or heavily used goods are resold, provided they were previously purchased from a non-trader.
57.      It is true that in the game the in-game Gold is treated as an object and traded with other objects. Nevertheless, it must be considered a service for the purposes of the VAT Directive, since Article 24 of the VAT Directive defines a supply of services as anything which does not constitute a supply of goods. Under Article 14(1) of the VAT Directive, a supply of goods requires the transfer of the right to dispose of tangible property as owner. In-game Gold is not tangible property. The question to be answered is therefore whether such services may be subsumed under the concept of second-hand goods where – in that respect there is a parallel with bitcoins (see above, point 38 et seq.) – they are traded in legal transactions in the same way as second-hand goods.
58.      If Article 314 of the VAT Directive is interpreted literally, only the supply of second-hand goods comes within the scope of the margin scheme. However, interpretation starts with the wording and does not end there. In interpreting a provision of EU law, it is necessary to consider not only its wording but also its context and its objectives (22) and in particular its origins. (23) Regard must also be had to the fact that the legislature is bound by higher-ranking law, which is why the fundamental rights under the Charter must also be taken into consideration in the interpretation, (24) and to the fact that the situation in practice might have evolved and it was therefore not possible for it to be taken into consideration in the historical wording.
59.      As Advocate General Szpunar has stated, the principle of separation of powers requires a degree of restraint on the part of the Court in that regard. (25) Interference in the normative content of laws in force is warranted only where those laws are vague, incomplete or contradictory or where a literal interpretation of those rules would lead to results which run counter not only to the objective of that legislation but also to fundamental principles. That is the case here.
60.      The wording ‘supply of goods’ does suggest that it should be understood for the purposes of VAT law, in a technical sense, as distinct from the supply of a service. However, the concept of supply of goods in a non-technical sense would also cover the sale of objects which are technically regarded as a service, but are considered in normal parlance more as a transfer of the right to dispose of an item and in reality (in legal transactions) are traded in the same way as goods and are thus treated as second-hand goods.
61.      Classic examples of that include the sale of an admission ticket in paper form or a physical document attesting the right to carriage, the sale of electronic art using an NFT, which proves ownership, or the sale of ‘objects’ in a computer game. Very few computer gamers would probably assume that, for example, the acquisition of a ‘magic sword’ is a service supplied by the game operator or another seller and that that person
has not granted them a right to dispose of ‘their magic sword’.
3.      Historical interpretation
62.      If regard is had to the drafting history of the margin scheme, it is apparent that it was introduced into the VAT Directive subsequently and only at a very late stage. (26) The Commission made a first proposal in 1973 which resulted only in a transitional provision. (27) The second Commission proposal in 1978 (28) was unsuccessful and a third was not presented until 1989. (29)
63.      According to the Explanatory Memorandum for the last Commission proposal, the margin scheme closes a ‘particularly important gap in relation to the requirements of neutrality in the common VAT system’. (30) The reason was problems in connection with the cross-border re-import of second-hand goods by private individuals, which explains the focus on ‘tangible property’.
64.      The Commission expressly states, however, that the purpose of its proposal relates to the application of ‘the principle of avoiding double taxation’. (31) The intention was to find a solution for second-hand goods being put back into commercial channels by dealers, as those goods had already borne VAT when they were purchased by private individuals and would be subject to VAT again when resold by a dealer. It was to be a special regime ‘applicable only to those traders specialised in [those] markets’. (32)
65.      In that regard, the Commission emphasised the wide scope of the special regime. ‘This reflects the idea of avoiding … the double taxation which can arise when a person resells goods the value of which includes non-deductible VAT.’ (33) Isolating second-hand goods which contain an element of residual tax from those goods which do not is so difficult, however, that all second-hand goods are to be included ‘to avoid an exposure … of the detail of the activities of the taxable dealer.’ (34) The margin scheme was possibly linked to the supply of second-hand goods because it was presumed at the time that a service is always consumed when it is supplied and cannot therefore be traded on.
66.      It could not be foreseen either in 1978 or in 1989, however, that, through the internet in particular, there would emerge a secondary market for many other objects that are traded in the same way as goods but are not tangible property. The trade in tickets for concerts and other events is a classic example where various online platforms permit purchase by private sellers and resale to other private buyers. In the present case too, the applicant has found a way to purchase intangible objects (in-game Gold) from private sellers and to resell them to private buyers. Assuming that the private buyers have themselves purchased the in-game Gold in the game for consideration (in-app purchase), there is no major difference with the difficulty
described by the Commission at the time.
67.      In any event, it cannot be inferred from the drafting history of the margin scheme that the trade in ‘second-hand’ services was deliberately excluded for specific reasons.
4.      Interpretation in the light of the objectives of the margin scheme
68.      The spirit and purpose of the margin scheme consists primarily in the implementation of the principle of neutrality, as the Commission made clear in the proposal introducing the margin scheme.
69.      The principle of neutrality requires, first, a level playing field for a taxable trader such that it can deduct the amount of its input transaction from the amount of its output transaction and then pay tax only on the difference. Second, according to the Commission, double taxation through the residual VAT typically contained in second-hand goods should be avoided. Both aspects are also reflected in recital 51 of the VAT Directive and the Court’s case-law. (35)
70.      Those two objectives must be considered in the light of the Charter of Fundamental Rights, by which the EU legislature has been bound since the Treaty of Lisbon. (36) For that reason too, there would have to be a justification for taxing the trade in second-hand goods and the trade in ‘second-hand’ services differently,
as that difference in treatment
undermines
the principle of neutrality.
71.      That recalls the question recently decided by the Court as to whether a differentiation may be made under the margin scheme in the art trade depending on the legal form under which the creator of a work of art carries on his or her commercial activity. Advocate General Szpunar (37) correctly considered that that was not the case in the absence of an objective reason. The Court subsequently confirmed that the principle of neutrality precludes taxable persons carrying out the same transactions from being treated differently in relation to the collection of VAT. (38)
72.      In the present case too, there is no objective reason to make a differentiation. The differentiation between supplies of goods and supplies of services is made in VAT law, in principle, solely for technical reasons because (generally for reasons of practicability) different places of taxation, different persons liable for payment of VAT, different rates and exemptions can be linked to it. The objectives pursued by the margin scheme of preventing double taxation or a competitive disadvantage do not, however, depend on such technical reasons. The technical distinction between a supply of services and a supply of goods is immaterial to the question whether normal taxation or the margin scheme applies, provided that services are not consumed immediately but are traded on in the same way as goods (such as admission tickets).
73.      In some cases, the classification of traded goods for VAT purposes is even inconsistent with the classification under civil law, which then makes such different tax consequences for traders appear even more questionable. For example, in German civil law, admission tickets are bearer instruments which are transferred in the same way as goods, because the right arising from the instrument stems from the right to the instrument (see Paragraph 807 of the Bürgerliches Gesetzbuch (German Civil Code)). Accordingly, there is actually a supply of goods (the instrument), but a supply of a service (admission) for VAT purposes. Nevertheless, the assessment for VAT purposes does not in any way alter the fact that admission tickets are transferred and traded in commercial transactions in the same way as goods.
74.      However, for services which are traded in the same way as second-hand goods, the VAT Directive does not include an arrangement comparable to the margin scheme mitigating the competitive disadvantage for the operating undertakings and preventing double taxation. That missing arrangement (legal loophole) leads to a conflict with the principle of neutrality (as an expression of Article 20 of the Charter), which does not mean that the directive is invalid, but can be resolved by a mutatis mutandis application (39) of Article 311 et seq. of the VAT Directive. The legislature evidently did not envisage a secondary market in ‘second-hand’ services at that time.
75.      As regards the restriction of the margin scheme to the supply of goods, neither a legally permissible objective nor a plausible reason for that legislative restriction is evident, even having regard to the broad discretion enjoyed by the legislature. The principle of equal treatment under Article 20 of the Charter – which thus constitutes primary law – also suggests a broader interpretation of the margin scheme so as to include the supply of services that are traded in the same way as second-hand goods.
76.      If, however, in-game Gold cannot be purchased by a taxable person but can, in principle, only be earned in the game, there is no such comparability in my view. It can also (typically) be ruled out that there might be any residual VAT to be taken into account. Accordingly, a mutatis mutandis application with a view to preventing double taxation would not come into consideration. It is for the referring commission to determine whether that is the case for in-game Gold.
5.      Interim conclusion
77.      In order to take account of technological progress and since there is no evidence that the trade in ‘second-hand’ services was deliberately excluded from the margin scheme for objective reasons, a mutatis mutandis application of Article 311 et seq. of the VAT Directive to tradable services is conceivable. The decisive factor is that such services are traded on a secondary market in a comparable way to regular second-hand goods.
VI.    Conclusion
78.      I therefore propose that the questions referred by the Mokestinių ginčų komisija prie Lietuvos Respublikos Vyriausybės (Tax Disputes Commission under the Government of the Republic of Lithuania) be answered as follows:
(1)      Article 135(1)(e) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax
must be interpreted as meaning that it exempts only transactions concerning legal tender or non-legal tender that is accepted as a contractual direct means of payment between operators and that thus has no other purpose than to be a means of payment in legal transactions.
(2)      In-game Gold (as an electronic service) does not merely serve to procure a later consumable benefit in the form of an as yet unspecified service, which the issuer of a voucher would be obliged to supply, but is itself already a consumable benefit. Therefore, it is not a voucher within the meaning of Article 30a of the VAT Directive.
(3)      Article 311(1)(1) of the VAT Directive must be interpreted, in the light of technological developments, in a teleologically broader manner as covering also transferable non-tangible objects, provided that they are traded in legal transactions in the same way as tangible objects. The decisive factor is that such services are traded on a secondary market in a comparable way to regular second-hand goods and
typically contain residual VAT. It is for the referring commission to determine whether that is the case for in-game Gold here.
1      Original language: German.
2      Johann Wolfgang von Goethe (1749-1832), Faust.
Part One, translated by A. Swanwick (published in Vol. 19 of the Harvard Classics, P. F. Collier & Son Company, New York, 1909).
3      Council Directive of 28 November 2006 (OJ 2006 L 347, p. 1), in the version
applicable in the years at issue, namely from 2020 to 2023.
4      Judgment of 21 October 2010, Nidera Handelscompagnie (C‑385/09, EU:C:2010:627, paragraph 34 et seq.).
5      Judgment of 21 March 2000, Gabalfrisa and Others (C‑110/98 to C‑147/98, EU:C:2000:145, paragraph 39 et seq.).
6      Judgment of 21 January 2020, Banco de Santander (C‑274/14, EU:C:2020:17, paragraph 55).
7      See, in that regard, judgment of 21 January 2020, Banco de Santander (C‑274/14, EU:C:2020:17, paragraph 72 et seq.).
8      Judgment of 22 October 2015 (C‑264/14, EU:C:2015:718, paragraph 49).
9      My Opinion in Hedqvist (C‑264/14, EU:C:2015:498, point 29 et seq.).
10      My Opinion in Hedqvist (C‑264/14, EU:C:2015:498, point 38 et seq.).
11      Judgments of 22 October 2015, Hedqvist (C‑264/14, EU:C:2015:718, paragraphs 36 and 48), and of 19 April 2007, Velvet & Steel Immobilien (C‑455/05, EU:C:2007:232, paragraph 24).
12      Judgment of 22 October 2015, Hedqvist (C‑264/14, EU:C:2015:718, paragraph 50).
13      Judgment of 22 October 2015, Hedqvist (C‑264/14, EU:C:2015:718, paragraphs 11 and 12).
14      Judgment of 22 October 2015, Hedqvist (C‑264/14, EU:C:2015:718, paragraph 52).
15      Judgment of 28 April 2022, DSAB Destination Stockholm (C‑637/20, EU:C:2022:304, paragraphs 20 and 21). With regard to single-purpose vouchers,
see judgment of 18 April 2024, Finanzamt O (Single-purpose vouchers) (C‑68/23, EU:C:2024:342, paragraph 36).
16      Delivered also on
11 September 2025.
17      For further detail, see
judgments of 17 May 2023,
État belge (VAT – Vehicles sold for parts)
(C‑365/22, EU:C:2023:415, paragraph 23); of 18 May 2017, Litdana (C‑624/15, EU:C:2017:389, paragraph 26); of 18 January 2017, Sjelle Autogenbrug (C‑471/15, EU:C:2017:20, paragraph 40), and of 1 April 2004, Stenholmen (C‑320/02, EU:C:2004:213, paragraph 25).
18      Specifically in connection with the margin scheme: judgment of 29 November 2018, Mensing (C‑264/17, EU:C:2018:968, paragraph 23, with reference to the judgment of 21 March 2013, PFC Clinic (C‑91/12, EU:C:2013:198, paragraph 23 and the case-law cited)). Similar judgment of 1 August 2025, Galerie Karsten Greve (C-433/24, EU:C:2025:600, paragraph 34).
19      Judgment of 8 December 2005, Jyske Finans (C‑280/04, EU:C:2005:753, paragraph 36 et seq.).
20      Judgment of 8 December 2005, Jyske Finans (C‑280/04, EU:C:2005:753, paragraph 42).
21      Judgments
of 18 January 2017, Sjelle Autogenbrug (C‑471/15, EU:C:2017:20, paragraph 34
et seq.), and of 1 April 2004, Stenholmen (C‑320/02, EU:C:2004:213, paragraphs 25
and 26); see also
judgment of 17 May 2023, État belge (VAT – Vehicles sold for parts) (C‑365/22, EU:C:2023:415,
paragraph 23).
22      As was also held by the Court in the judgments of 1 August 2025, Galerie Karsten Greve (C‑433/24, EU:C:2025:600, paragraph 31); of 29 November 2018, Mensing (C‑264/17, EU:C:2018:968, paragraph 24); of 21 September 2017, Aviva (C‑605/15, EU:C:2017:718, paragraph 24); of 3 March 2011, Auto Nikolovi (C‑203/10, EU:C:2011:118, paragraph 41); and of 8 December 2005, Jyske Finans
(C‑280/04, EU:C:2005:753, paragraph 34).
23      Judgments of 11 July 2018, E LATS (C‑154/17, EU:C:2018:560, paragraph 18), and of 17 April 2018, Egenberger (C‑414/16, EU:C:2018:257, paragraph 44).
24      See to that effect also judgment of 29 November 2018, Mensing (C‑264/17, EU:C:2018:968, paragraphs 33 and 34).
25      Opinion of Advocate General Szpunar in Mensing (C‑180/22, EU:C:2023:242, point 46 et seq.).
26      With regard to the drafting history, see also the judgments of 9 July 1992, ‘K’ Line Air Service Europe (C‑131/91, EU:C:1992:315, paragraph 16), and of 5 December 1989, ORO Amsterdam Beheer and Concerto (C‑165/88, EU:C:1989:608, paragraph 11).
27      Proposal of 29 June 1973
(OJ 1973 C 80, p. 1).
It resulted in the transitional provision in Article 32 of the Sixth Directive.
28      Proposal of 11 January 1978
(OJ 1978 C 26, p. 2).
29      Proposal of 11 January 1989
(OJ 1989 C 76, p. 10).
30      Commission proposal of 3 February 1988 to the Council – COM(88)
846 final, p. 2. A copy of the German version of that Explanatory Memorandum can be found in the Explanatory Statement in connection with transposition into the German Umsatzsteuergesetz (Law on Turnover); see the resolution recommendation and report of the Finance Committee of 13 February 1990 – BT-Drucksache 11/6420 (Annex 2): ‘Vorschlag für eine Richtlinie des Rates zur Ergänzung des gemeinsamen Mehrwertsteuersystems und zur Änderung der Artikel 32 und 28 der Richtlinie 77/388/EWG – Sonderregelung für Gebrauchtgegenstände, Kunstgegenstände, Antiquitäten und Sammlungsstücke’ (‘Proposal for a Council Directive supplementing the common system of value added tax and amending Articles 32 and 28 of Directive 77/388/EEC – Special arrangements for second-hand goods, works of art, antiques and collector’s items’) (EC Doc.
4204/89), introduction.
31      Commission proposal of 3 February 1988 to the Council – COM(88)
846 final, p. 4, and BT-Drucksache 11/6420, Annex 2, section
I.
32      Commission proposal of 3 February 1988 to the Council – COM(88)
846 final, p. 5, and BT-Drucksache 11/6420, Annex 2, section I, in fine.
33      Commission proposal of 3 February 1988 to the Council – COM(88)
846 final, p. 6, and BT-Drucksache 11/6420, Annex 2, on Article 1, Chapter
A.1.
34      Commission proposal of 3 February 1988 to the Council – COM(88)
846 final, p. 6, and
BT-Drucksache 11/6420, Annex 2, on Article 1, Chapter
A.1. See, also in that regard, the judgments of 1 August 2025, Galerie Karsten Greve (C‑433/24, EU:C:2025:600, paragraph 39), and of 29 November 2018, Mensing (C‑264/17, EU:C:2018:968, paragraph 36).
35      Judgments of 1 August 2025, Galerie Karsten Greve (C‑433/24, EU:C:2025:600, paragraph 36; of 11 July 2018, E LATS
(C‑154/17, EU:C:2018:560, paragraph 27); of 18 May 2017, Litdana (C‑624/15, EU:C:2017:389, paragraph 25); of 18 January 2017, Sjelle Autogenbrug (C‑471/15, EU:C:2017:20, paragraph 39); of 3 March 2011, Auto Nikolovi (C‑203/10, EU:C:2011:118, paragraph 47), and of 8 December 2005, Jyske Finans (C‑280/04, EU:C:2005:753, paragraphs 37 and 41).
36      See, in that regard, judgment of 7 March 2017, RPO (C‑390/15, EU:C:2017:174, paragraph 38 et seq.).
37      Opinion of Advocate General Szpunar in Galerie Karsten Greve (C‑433/24, EU:C:2025:438, point 29).
38      Judgment of 1 August 2025, Galerie Karsten Greve (C‑433/24, EU:C:2025:600, paragraph 41 et seq.).
39      That is also the view taken (in Germany at least) by prominent tax law experts: Wäger, C., Neues aus Europa: Der Gleichbehandlungsgrundsatz und seine Bedeutung für the MwStSystRL, Deutsches Steuerrecht 2017, p. 2017 (2020 and 2021); Stadie, H., in Rau/Dürrwächter, Kommentar zum UStG, Introduction, paragraph 613 (as at January 2024); Hey, J., and Hoffsümmer, P., Umsatzsteuerliche Behandlung des Handels mit Eintrittskarten für Sportveranstaltungen und Musikveranstaltungen, Umsatzsteuer-Rundschau 2005, p. 641 (648).