SC Gran Via Moineşti SRL v Agenţia Naţională de Administrare Fiscală (ANAF) and Administraţia Finanţelor Publice Bucureşti Sector 1.
Date: 2012-11-29
20. It must first be borne in mind that, according to settled case‑law of the Court of Justice, 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 relevant European Union legislation (Joined Cases C‑80/11 and C‑142/11 Mahagében and Dávid  [2012] ECR, paragraph 37 and the case‑law cited).
21. The Court has repeatedly held that the right to deduct provided for in Article 167 et seq. of Directive 2006/112 is an integral part of the VAT scheme and in principle may not be limited. The right to deduct is exercisable immediately in respect of all the taxes charged on transactions relating to inputs (see, inter alia, Joined Cases C‑110/98 to C‑147/98 Gabalfrisa and Others  [2000] ECR I‑1577, paragraph 43; Case C‑63/04 Centralan Property  [2005] ECR I‑11087, paragraph 50; Joined Cases C‑439/04 and C‑440/04 Kittel and Recolta Recycling  [2006] ECR I‑6161, paragraph 47; and Mahagében and Dávid , paragraph 38).
22. 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 complete neutrality of taxation of all economic activities, whatever the purpose or results of those activities, provided that they are themselves subject to VAT (see Case 268/83 Rompelman  [1985] ECR 655, paragraph 19; Case C‑37/95 Ghent Coal Terminal  [1998] ECR I‑1, paragraph 15; Gabalfrisa and Others , paragraph 44; Case C‑32/03 Fini H  [2005] ECR I‑1599, paragraph 25; Centralan Property , paragraph 51; and Mahagében and Dávid , paragraph 39).
23. It is clear from the wording of Article 168 of Directive 2006/112 that, to qualify for the right to deduct, first, the person concerned must be a ‘taxable person’ within the meaning of that directive and, second, the goods and services in question must be used for the purposes of his taxed transactions (see Centralan Property , paragraph 52).
24. Under Article 9(1) of that directive a ‘taxable person’ is defined by reference to the term ‘economic activity’ (see Fini H , paragraph 19).
25. In this regard, it should be borne in mind that an individual who acquires goods for the purposes of an economic activity within the meaning of that provision does so as a taxable person, even if the goods are not used immediately for that economic activity (see Case C‑97/90 Lennartz  [1991] ECR I‑3795, paragraph 14).
26. According to the settled case‑law of the Court, the economic activity referred to in Article 9(1) of Directive 2006/112 may consist in several consecutive transactions and, among those, preparatory acts, such as the acquisition of business assets and therefore the purchase of immovable property, must be regarded as constituting economic activity (see Rompelman , paragraph 22; Lennartz , paragraph 13; Case C‑110/94 INZO  [1996] ECR I‑857, paragraph 15; and Fini H , paragraphs 21 and 22). Any person performing such preparatory acts is consequently regarded as a taxable person within the meaning of that provision and is entitled to deduct the VAT ( Fini H , paragraph 22).
27. Furthermore, a person who incurs investment expenditure with the intention, confirmed by objective evidence, of engaging in economic activity within the meaning of Article 9(1) of Directive 2006/112 must be regarded as a taxable person. Acting in that capacity, he has therefore, in accordance with Article 167 et seq. of the directive, the right immediately to deduct the VAT payable or paid on the investment expenditure incurred for the purposes of the transactions which he intends to carry out and which give rise to the right to deduct (see, to that effect, Rompelman , paragraphs 23 and 24; INZO , paragraphs 16 and 17; Ghent Coal Terminal , paragraph 17; Gabalfrisa and Others , paragraph 47; and Case C‑400/98 Breitsohl  [2000] ECR I‑4321, paragraph 34).
28. Accordingly, it is the acquisition of goods by a taxable person acting as such that gives rise to the application of the VAT system and therefore of the deduction mechanism. The use to which the goods or services are put, or intended to be put, merely determines the extent of the initial deduction to which the taxable person is entitled under Article 168 of Directive 2006/112 and the extent of any adjustments in the course of the following periods, adjustments which must be made under the conditions laid down in Article 184 et seq. of that directive (see Lennartz , paragraph 15; Ghent Coal Terminal , paragraph 18; Case C‑396/98 Schloßstrasse  [2000] ECR I‑4279, paragraph 37; Breitsohl , paragraph 35; Centralan Property , paragraph 54; Case C‑118/11 Eon Aset Menidjmunt  [2012] ECR, paragraph 57; and Case C‑334/10 X [2012] ECR, paragraph 17).
29. In this context, the Court has held that, in the absence of fraud or abuse and subject to adjustments which may be made in accordance with the conditions laid down in Article 185 of Directive 2006/112, the right to deduct, once it has arisen, is retained even if the economic activity envisaged does not give rise to taxed transactions (see INZO , paragraphs 20 and 21; Ghent Coal Terminal , paragraphs 19 to 23; Schloßstrasse , paragraph 42; Case C‑98/98 Midland Bank  [2000] ECR I‑4177, paragraph 22; and Fini H , paragraph 22).
35. Those buildings were acquired along with the land on which they had been constructed and that land continues to be used by GVM for the purposes of its taxed transactions. In those circumstances the replacement of dilapidated structures with more modern buildings which, consequently, are used for taxable output transactions in no way breaks the direct link between, on the one hand, the input acquisition of the buildings at issue and, on the other, the economic activities carried out thereafter by the taxable person. The acquisition of those buildings and their subsequent destruction with a view to building more modern new ones 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 (see Case C‑234/11 TETS Haskovo  [2012] ECR, paragraph 34).
38. According to the case‑law of the Court, the rules relating to the adjustment of deductions are an essential element of the system established by Directive 2006/112 in that they seek to ensure the accuracy of deductions and, consequently, the neutrality of the tax burden (see Case C‑184/04 Uudenkaupungin kaupunki  [2006] ECR I‑3039, paragraph 26). By those rules, the directive aims to establish a close and direct relationship between the right to deduct input VAT and the use of the goods or services concerned for taxed output transactions (see Centralan Property , paragraph 57, and TETS Haskovo , paragraph 31).
39. The adjustment mechanism provided for in Directive 2006/112 is an integral part of the VAT deduction scheme established by that directive (see TETS Haskovo , paragraph 30).
40. So far as concerns the coming into existence of an obligation to make an adjustment of an input VAT deduction, Article 185(1) of that directive establishes the principle that such an adjustment is made in particular where, after the VAT return is made, some change occurs in the factors used to determine the amount to be deducted (see TETS Haskovo , paragraph 32).