1999/82/EC: Council Decision of 18 January 1999 authorising the Portuguese Republic to apply a measure derogating from Articles 21(1)(a) and 22 of the Sixth Directive (77/388/EEC) on the harmonisation of the laws of the Member States relating to turnover taxes
Date: 1999-01-18
Institutions: Council of the European Union
Subjects: Portugal, VAT, approximation of laws, derogation from EU law, door-to-door selling, tax harmonisation

L 27/28

EN

Official Journal of the European Communities

2. 2. 1999

COUNCIL DECISION

of 18 January 1999

authorising the Portuguese Republic to apply a measure derogating from Articles
21(1)(a) and 22 of the Sixth Directive (77/388/EEC) on the harmonisation of the
laws of the Member States relating to turnover taxes

(1999/82/EC)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community,

Having regard to the Sixth Council Directive (77/
388/EEC) of 17 May 1977 on the harmonisation of the
laws of the Member States relating to turnover taxes —
common system of value-added tax: uniform basis for
assessment (1), and in particular Article 27(1) thereof,

Having regard to the proposal from the Commission,

to Article 27(1) of Directive 77/
Whereas, pursuant
388/EEC, the Council, acting unanimously on a proposal
from the Commission, may authorise any Member State
to introduce special measures for derogation from that
Directive in order to simplify the procedure for charging
the tax or to prevent certain types of tax evasion and
avoidance;

Whereas, by letter registered with the Commission on 17
March 1998, the Portuguese Republic requested author-
isation to introduce a measure derogating from Articles
21(1)(a) and 22 of Directive 77/388/EEC;

Whereas, in accordance with Article 27(3) of Directive
77/388/EEC, the other Member States were informed on
19 May 1998 of the request submitted by the Portuguese
Republic;

Whereas that special measure is designed to allow certain
firms engaged in doorstep selling to request
the tax
administration for authorisation to pay VAT on the prod-
ucts sold in place of their resellers, provided that their
total turnover is derived from doorstep sales by resellers
acting in their own name and on their own account and
all the products sold by the firm are included in a list on
which the selling price to the final consumer
is
mentioned;

Whereas the derogation is restricted to cases in which
firms sell products direct to resellers and those resellers
sell them directly to final consumers;

Whereas firms which satisfy these conditions and have
been authorised to do so by the tax administration would
pay VAT to the public revenue department on the basis of
a retail price fixed in advance;

Whereas the resellers concerned would therefore no
longer required to pay VAT on their sales and would
accordingly not be entitled to deduct input tax;

Whereas
this measure constitutes a derogation from
Article 21(1)(a) in that the wholesaler is deemed to be the
person liable for
tax payable on goods supplied by
resellers to final consumers;

Whereas the obligations in connection with such sales
(e.g. declaration, invoicing, payment, etc.) fall upon the
wholesaler, who will, therefore, by way of derogation from
Article 22 of Directive 77/388/EEC, be exempt
from
fulfilling such obligations in respect of his supplies to the
reseller;

Whereas this sector is characterised by the existence of a
very large number of small resellers who do not have the
resources or organisational capacity to fulfil their VAT
obligations; whereas this measure, therefore, both simpli-
fies matters and helps to combat tax fraud;

Whereas, consequently, the special measure satisfies the
conditions laid down in Article 27 of Directive 77/
388/EEC;

Whereas the Commission adopted on 10 July 1996 a
work programme,
the
phased introduction of a common system of VAT for the
single market;

together with a timetable for

Whereas it would,
therefore, be appropriate to grant
authorisation until 31 December 2000 so that an assess-
ment can then be made of
the
measure with the overall approach adopted for the new
common system of VAT;

the compatibility of

(1) OJ L 145, 13. 6. 1977, p. 1. Directive as last amended by

Directive 96/95/EC,

(OJ L 338, 28. 12. 1996, p. 89).

Whereas this derogation will have no impact on the Euro-
pean Communities’ own resources accruing from VAT,

2. 2. 1999

EN

Official Journal of the European Communities

L 27/29

HAS ADOPTED THIS DECISION:

Article 2

Article 1

The Portuguese Republic is hereby authorised from 1
January 1999 until 31 December 2000 to apply a special
measure for the taxation of doorstep sales that contains
77/
provisions derogating
388/EEC.

from Council Directive

Firms whose total turnover is derived from doorstep sales
carried out by resellers acting in their own name and for
their own account may request the administration for
authorisation to apply the provisions of Articles 2 and 3
below on condition that:

— all products sold by the firm are contained in a pre-
established price list applicable at the final consump-
tion stage,

— the firm sells its products direct to resellers who, in

turn, sell direct to final consumers.

By way of derogation from Article 21(1)(a) of the Sixth
Directive, firms which have been authorised to apply this
special measure shall be liable for the tax payable on
goods supplied by their resellers to final consumers.

Article 3

Firms which have been authorised to apply this special
measure shall be exempt from the obligations laid down
in Article 22 of Directive 77/388/EEC as regards supplies
of their products to resellers.

Article 4

This Decision is addressed to the Portuguese Republic.

Done at Brussels, 18 January 1999.

For the Council

The President

O. LAFONTAINE