Case C‑16/14

Property Development Company NV

v

Belgische Staat

(Request for a preliminary ruling from the hof van beroep te Gent)

‛Reference for a preliminary ruling — Taxation — Sixth VAT Directive — Article 11A — Application of goods treated as a supply for consideration — Application of a building for an activity exempt from VAT — Taxable amount for that application — Interim interest paid during the construction of the building’

Summary — Judgment of the Court (Third Chamber), 23 April 2015

Harmonisation of fiscal legislation — Common system of value added tax — Taxable amount — Application of a building constructed by a taxable person to a non-taxable area of activity — Taxable amount constituted by the purchase price of similar buildings — Inclusion of interim interest paid during construction — No effect

(Council Directive 77/388, Arts 5(7)(b) and 11A(1)(b))

Article 11A(1)(b) of the Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes must be interpreted as meaning that the taxable amount for the calculation of VAT on an application, within the meaning of Article 5(7)(b) thereof, of a building that the taxable person has constructed, is to be the purchase price, at the time the application is made, of buildings whose location, size and other essential characteristics are similar to those of the building in question. In that regard, it is irrelevant whether part of the purchase price is due to interest on borrowed capital.

Unlike the criterion of cost price laid down in Article 11A(1)(b) of the Sixth Directive as the taxable amount in the absence of a purchase price, the criterion of the purchase price of similar goods enables the tax authority to base its calculation on the market price of that type of goods at the time the application of the building at issue was made, without having to examine in detail which components of the value gave rise to those prices, such as the actual interim interest paid by the taxable person itself during the construction of the building at issue.

(see paras 40, 41, 43, operative part)

Case C‑16/14

Property Development Company NV

v

Belgische Staat

(Request for a preliminary ruling from the hof van beroep te Gent)

‛Reference for a preliminary ruling — Taxation — Sixth VAT Directive — Article 11A — Application of goods treated as a supply for consideration — Application of a building for an activity exempt from VAT — Taxable amount for that application — Interim interest paid during the construction of the building’

Summary — Judgment of the Court (Third Chamber), 23 April 2015

Harmonisation of fiscal legislation — Common system of value added tax — Taxable amount — Application of a building constructed by a taxable person to a non-taxable area of activity — Taxable amount constituted by the purchase price of similar buildings — Inclusion of interim interest paid during construction — No effect

(Council Directive 77/388, Arts 5(7)(b) and 11A(1)(b))

Article 11A(1)(b) of the Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes must be interpreted as meaning that the taxable amount for the calculation of VAT on an application, within the meaning of Article 5(7)(b) thereof, of a building that the taxable person has constructed, is to be the purchase price, at the time the application is made, of buildings whose location, size and other essential characteristics are similar to those of the building in question. In that regard, it is irrelevant whether part of the purchase price is due to interest on borrowed capital.

Unlike the criterion of cost price laid down in Article 11A(1)(b) of the Sixth Directive as the taxable amount in the absence of a purchase price, the criterion of the purchase price of similar goods enables the tax authority to base its calculation on the market price of that type of goods at the time the application of the building at issue was made, without having to examine in detail which components of the value gave rise to those prices, such as the actual interim interest paid by the taxable person itself during the construction of the building at issue.

(see paras 40, 41, 43, operative part)