Judgment of the Court (Second Chamber) of 4 June 2015 — Commission v United Kingdom

(Case C‑161/14) ( 1 )

‛Failure of a Member State to fulfil obligations — Common system of value added tax — Directive 2006/112/EC — Article 98(2) — Category (10) of Annex III — Reduced rate of VAT applicable to the provision, construction, renovation and alteration of housing, as part of a social policy — Category (10a) of Annex III — Reduced rate of VAT applicable to renovation and repairing of private dwellings, excluding materials which account for a significant part of the value of the service supplied — National legislation applying a reduced rate of VAT to supplies of services of installing energy-saving materials and supplies of such materials’

1. EU law — Interpretation — Texts in several languages — Differences between the various language versions — General scheme and purpose of the rules at issue taken into account (Council Directive 2006/112, Annex III, para. 10) (see paras 21-23, 25)

2. Harmonisation of fiscal legislation — Common system of value added tax — Discretionary power of the Member States to apply a reduced rate to certain supplies of goods and services — Reduced rate applicable to the provision, construction, renovation and alteration of housing, as part of a social policy — Application of a reduced rate to supplies of services of installing energy-saving materials and supplies of such materials — Widening of the scope of application of the reduced rate to all services and supplies of energy-saving materials which are not of an essentially social nature, within the meaning of EU law — Failure to fulfil obligations (Council Directive 2006/112, Arts 98(2) and 110 and Annexe III, para. 10) (see paras 30-33, 40)

3. Harmonisation of fiscal legislation — Common system of value added tax — Discretionary power of the Member States to apply a reduced rate to certain supplies of goods and services — Reduced rate of VAT applicable to renovation and repairing of private dwellings, excluding materials which account for a significant part of the value of the service supplied — Application of a reduced rate to supplies of services of installing energy-saving materials and supplies of such materials — Widening of the scope of application of the reduced rate to the provision and construction of those private dwellings — Failure to fulfil obligations (Council Directive 2006/112, Art. 98(2) and Annex III, point 10a) (paras 35-40)

Operative part

The Court:

1. Declares that, by applying a reduced rate of value added tax to supplies of services of installing ‘energy-saving materials’ and to supplies of such materials by a person who installs those materials in residential accommodation:

– to the extent that those supplies cannot be considered as ‘the provision, construction, renovation and alteration of housing, as part of a social policy’ for the purposes of Category 10 of Annex III to Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, as amended by Council Directive 2009/47/EC of 5 May 2009;

– to the extent that those supplies fall outside the purview of ‘renovation and repairing of private dwellings’ for the purposes of Category 10a of Annex III to that directive, and

– to the extent that even where those supplies fall within the purview of renovation and repairing of private dwellings for the purposes of Category (10a) of Annex III to that directive, those supplies include materials which account for a significant part of the value of the services supplied,

the United Kingdom of Great Britain and Northern Ireland has failed to fulfil its obligations under Article 98 of Directive 2006/112, as amended by Directive 2009/47, read together with Annex III to that directive.

2. Orders the United Kingdom of Great Britain and Northern Ireland to pay the costs.

( 1 ) OJ C 212, 7.7.2014.

Judgment of the Court (Second Chamber) of 4 June 2015 — Commission v United Kingdom

(Case C‑161/14) ( 1 )

‛Failure of a Member State to fulfil obligations — Common system of value added tax — Directive 2006/112/EC — Article 98(2) — Category (10) of Annex III — Reduced rate of VAT applicable to the provision, construction, renovation and alteration of housing, as part of a social policy — Category (10a) of Annex III — Reduced rate of VAT applicable to renovation and repairing of private dwellings, excluding materials which account for a significant part of the value of the service supplied — National legislation applying a reduced rate of VAT to supplies of services of installing energy-saving materials and supplies of such materials’

1. EU law — Interpretation — Texts in several languages — Differences between the various language versions — General scheme and purpose of the rules at issue taken into account (Council Directive 2006/112, Annex III, para. 10) (see paras 21-23, 25)

2. Harmonisation of fiscal legislation — Common system of value added tax — Discretionary power of the Member States to apply a reduced rate to certain supplies of goods and services — Reduced rate applicable to the provision, construction, renovation and alteration of housing, as part of a social policy — Application of a reduced rate to supplies of services of installing energy-saving materials and supplies of such materials — Widening of the scope of application of the reduced rate to all services and supplies of energy-saving materials which are not of an essentially social nature, within the meaning of EU law — Failure to fulfil obligations (Council Directive 2006/112, Arts 98(2) and 110 and Annexe III, para. 10) (see paras 30-33, 40)

3. Harmonisation of fiscal legislation — Common system of value added tax — Discretionary power of the Member States to apply a reduced rate to certain supplies of goods and services — Reduced rate of VAT applicable to renovation and repairing of private dwellings, excluding materials which account for a significant part of the value of the service supplied — Application of a reduced rate to supplies of services of installing energy-saving materials and supplies of such materials — Widening of the scope of application of the reduced rate to the provision and construction of those private dwellings — Failure to fulfil obligations (Council Directive 2006/112, Art. 98(2) and Annex III, point 10a) (paras 35-40)

Operative part

The Court:

1. Declares that, by applying a reduced rate of value added tax to supplies of services of installing ‘energy-saving materials’ and to supplies of such materials by a person who installs those materials in residential accommodation:

– to the extent that those supplies cannot be considered as ‘the provision, construction, renovation and alteration of housing, as part of a social policy’ for the purposes of Category 10 of Annex III to Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, as amended by Council Directive 2009/47/EC of 5 May 2009;

– to the extent that those supplies fall outside the purview of ‘renovation and repairing of private dwellings’ for the purposes of Category 10a of Annex III to that directive, and

– to the extent that even where those supplies fall within the purview of renovation and repairing of private dwellings for the purposes of Category (10a) of Annex III to that directive, those supplies include materials which account for a significant part of the value of the services supplied,

the United Kingdom of Great Britain and Northern Ireland has failed to fulfil its obligations under Article 98 of Directive 2006/112, as amended by Directive 2009/47, read together with Annex III to that directive.

2. Orders the United Kingdom of Great Britain and Northern Ireland to pay the costs.

( 1 ) OJ C 212, 7.7.2014.