Zabrus Siret SRL v Direcţia Generală Regională a Finanţelor Publice Iaşi - Administraţia Judeţeană a Finanţelor Publice Suceava.
Date: 2018-04-26
32


As regards the right of deduction, it must be borne in mind that, according to settled case-law, the right of taxable persons to deduct the VAT due or already paid on goods purchased and services received as inputs from the VAT which they are liable to pay is a fundamental principle of the common system of VAT established by the EU legislature (see, inter alia, judgments of 21 June, Mahagében and Dávid, C‑80/11 and C‑142/11, EU:C:2012:373, paragraph 37, and of 19 October 2017, Paper Consult, C‑101/16, EU:C:2017:775, paragraph 35).
33


As the Court has repeatedly held, the right of deduction provided for in Article 167 et seq. of the VAT Directive is an integral part of the VAT scheme and may not, in principle, be limited. In particular, the right of deduction is exercisable immediately in respect of all the taxes charged on transactions relating to inputs (see, inter alia, judgments of 21 June 2012, Mahagében and Dávid, C‑80/11 and C‑142/11, EU:C:2012:373, paragraph 38, and of 19 October 2017, Paper Consult, C‑101/16, EU:C:2017:775, paragraph 36).
34


The deduction system is intended to relieve the trader entirely of the burden of the VAT payable or paid in the course of all his economic activities. The common system of VAT consequently ensures the neutrality of taxation of all economic activities, whatever the purpose or results of those activities, provided that they are themselves subject in principle to VAT (see, inter alia, judgments of 21 June 2012, Mahagében and Dávid, C‑80/11 and C‑142/11, EU:C:2012:373, paragraph 39, and of 19 October 2017, Paper Consult, C‑101/16, EU:C:2017:775, point 37).
37


Nevertheless, pursuant to Articles 180 and 182 of the VAT Directive, a taxable person may be authorised to make a deduction even if he did not exercise his right during the period in which the right arose, subject to compliance with certain conditions and procedures determined by national legislation (see judgment of 12 July 2012 in EMS-Bulgaria Transport, C‑284/11, EU:C:2012:458, paragraph 46 and the case-law cited).
38


In that regard, it is apparent from the case-law of the Court that the possibility of exercising the right of deduction without any temporal limit would be contrary to the principle of legal certainty, which requires the tax position of the taxable person, in the light of his rights and obligations vis-à-vis the tax authority, not to be open to challenge indefinitely. Therefore, a limitation period the expiry of which has the effect of penalising a taxable person who has not been sufficiently diligent and has failed to claim deduction of input tax, by making him forfeit his right of deduction, cannot be regarded as incompatible with the regime established by the VAT Directive, in so far as, first, that limitation period applies in the same way to analogous rights in tax matters founded on domestic law and to those founded on EU law (principle of equivalence) and, second, that it does not in practice render impossible or excessively difficult the exercise of the right of deduction (principle of effectiveness) (see, to that effect, judgment of 12 July 2012, EMS-Bulgaria Transport, C‑284/11, EU:C:2012:458, paragraphs 48 and 49 and the case-law cited).
40


Although it does not follow from the information provided by the referring court that the national legislation at issue in the main proceedings lays down, in respect of VAT, a scheme different from that laid down in other tax matters under national law, the principle of effectiveness, on the other hand, precludes such legislation in so far as it is liable to deny, in circumstances such as those at issue in the main proceedings, a taxable person the opportunity to correct his VAT returns when he has been the subject of a tax inspection concerning the tax period relating to that correction, even though the five-year limitation period laid down by that legislation has not yet elapsed.
44


The principle of VAT neutrality requires, according to settled case-law, the deduction of input tax to be allowed if the substantive requirements are satisfied, even if the taxable person has failed to comply with some of the formal requirements (see, to that effect, judgment of 28 July 2016, Astone, C‑332/15, EU:C:2016:614, paragraph 45).
48


As regards the principle of proportionality, it is true that the national legislature is able to attach penalties to the formal obligations of taxable persons to encourage them to comply with those obligations, in order to ensure the proper working of the VAT system.
49


Accordingly, an administrative fine could, inter alia, be imposed on a negligent taxable person who corrects his VAT return by relying on documents proving his entitlement to a VAT deduction which were in his possession at the time his VAT return was filed or following the discovery of a recording error altering the amount of VAT to be reimbursed.
50


However, the Member States must, in accordance with the principle of proportionality, employ means which, whilst enabling them effectively to attain the objective pursued by national legislation, are the least detrimental to the principles laid down by EU legislation, such as the fundamental principle of the right to deduct VAT (judgment of 10 July 2008, Sosnowska, C‑25/07, EU:C:2008:395, paragraph 23).
51


Therefore, in a situation such as that at issue in the main proceedings, in view of the dominant position which the right of deduction has in the common system of value added tax, a penalty consisting of an absolute refusal of the right of deduction appears disproportionate where no evasion or detriment to the budget of the State is ascertained (judgment of 12 July 2012, EMS-Bulgaria Transport, C‑284/11, EU:C:2012:458, paragraph 70 and the case-law cited).
55


No other conclusion can be drawn from the judgment of 6 February 2014, Fatorie (C‑424/12, EU:C:2014:50). It admittedly follows from that judgment that a taxable person cannot rely, within the limitation period, on the principle of legal certainty to oppose the authorities revoking a decision by which they granted the taxable person the right to deduct VAT, while ordering him, following a fresh investigation, to pay that tax together with default interest (see, to that effect, judgment of 6 February 2014, Fatorie, C‑424/12, EU:C:2014:50, paragraph 51). On the other hand, it does not follow from that judgment that the tax authorities may rely, within the limitation period, on that principle to oppose the correction by the taxable person of a VAT return in respect of a period which has already been subject to a tax inspection.