TETS Haskovo AD v Direktor na Direktsia ‘Obzhalvane i upravlenie na izpalnenieto’ – Varna pri Tsentralno upravlenie na Natsionalnata agentsia za prihodite.
Date: 2012-10-18
26. In order to answer that question, it must be noted at the outset that Articles 184 to 186 of the Directive constitute the scheme applicable with regard to any entitlement of the tax authority to require adjustment to be made by a taxable person, including adjustment of deductions made in respect of capital goods.
27. Furthermore, it should be recalled that the deduction scheme established by the Directive is meant to relieve the operator entirely of the burden of the VAT paid or payable in the course of all his economic activities. Thus, the common system of VAT seeks to ensure complete neutrality of taxation of all economic activities, whatever their purpose or results, provided that they are themselves subject, in principle, to VAT (see Case C-153/11 Klub  [2012] ECR, paragraph 35 and the case-law cited).
28. It follows from Article 168 of the Directive that, in so far as the taxable person, acting as such at the time when he acquires goods, uses the goods for the purposes of his taxable transactions, he is entitled to deduct the VAT paid or payable in respect of the goods. That right to deduct arises at the time when the deductible tax becomes chargeable, namely when the goods are delivered (see Klub , paragraph 36 and the case-law cited).
29. So far as concerns the impact on that deduction of any events occurring after the deduction is made, it is clear from the case-law that the use to which the goods or services are put, or are intended to be put, determines the extent of the initial deduction to which the taxable person is entitled and the extent of any adjustments in the course of the following periods, which must be made under the conditions laid down in Articles 185 to 187 of the Directive (see, to that effect, Case C-63/04 Centralan Property  [2005] ECR I-11087, paragraph 54 and the case-law cited).
30. The adjustment provided for in those articles of the Directive is an integral part of the VAT deduction scheme established by that directive.
31. It should be noted in that regard that the rules laid down by the Directive in respect of adjustment are intended to enhance the precision of deductions so as to ensure the neutrality of VAT, with the result that transactions effected at an earlier stage continue to give rise to the right to deduct only to the extent that they are used to make supplies subject to VAT. By those rules, the Directive thus aims to establish a close and direct relationship between the right to deduct input VAT and the use of the goods and services concerned for taxable output transactions (see Centralan Property , paragraph 57).
32. As regards the coming into existence of an obligation to make an adjustment of an input VAT deduction, Article 185(1) of the Directive establishes the principle that such an adjustment must be made inter alia when changes to factors which were taken into consideration for the determination of the amount of such a deduction occurred after the VAT return.
34. In that regard, in a situation such as that at issue in the main proceedings, the replacement of old buildings with more modern buildings which fulfil the same purpose and, consequently, are used for taxable output transactions in no way breaks the direct link between the input acquisition of the buildings at issue, on the one hand, and the economic activities carried out thereafter by the taxable person, on the other. The acquisition of the buildings at issue and their subsequent destruction with a view to modernising them can, therefore, be regarded as a series of linked transactions for the purposes of subsequent taxable transactions in the same way as the acquisition of new buildings and their direct use.