D.A. Rompelman and E.A. Rompelman-Van Deelen v Minister van Financiën.
Date: 1985-02-14
19 FROM THE PROVISIONS SET FORTH ABOVE IT MAY BE CONCLUDED THAT THE DEDUCTION SYSTEM IS MEANT 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 VALUE-ADDED TAX THEREFORE ENSURES THAT ALL ECONOMIC ACTIVITIES , WHATEVER THEIR PURPOSE OR RESULTS , PROVIDED THAT THEY ARE THEMSELVES SUBJECT TO VAT , ARE TAXED IN A WHOLLY NEUTRAL WAY .
22 AS REGARDS THE QUESTION OF THE TIME WHEN THE EXPLOITATION OF IMMOVABLE PROPERTY COMMENCES , IT MUST FIRST BE POINTED OUT THAT THE ECONOMIC ACTIVITIES REFERRED TO IN ARTICLE 4 ( 1 ) MAY CONSIST IN SEVERAL CONSECUTIVE TRANSACTIONS , AS IS INDEED SUGGESTED BY THE WORDING OF ARTICLE 4 ( 2 ) WHICH REFERS TO ' ALL ACTIVITIES OF PRODUCERS , TRADERS AND PERSONS SUPPLYING SERVICES ' . THE PREPARATORY ACTS , SUCH AS THE ACQUISITION OF ASSETS AND THEREFORE THE PURCHASE OF IMMOVABLE PROPERTY , WHICH FORM PART OF THOSE TRANSACTIONS MUST THEMSELVES BE TREATED AS CONSTITUTING ECONOMIC ACTIVITY .
23 IN THIS REGARD , IT IS NOT NECESSARY TO DISTINGUISH THE VARIOUS LEGAL FORMS WHICH SUCH PREPARATORY ACTS MAY TAKE , IN PARTICULAR BETWEEN THE ACQUISITION OF A RIGHT TO THE TRANSFER OF THE FUTURE OWNERSHIP OF PROPERTY AND THE ACQUISITION OF THE PROPERTY ITSELF . FURTHERMORE , THE PRINCIPLE THAT VAT SHOULD BE NEUTRAL AS REGARDS THE TAX BURDEN ON A BUSINESS REQUIRES THAT THE FIRST INVESTMENT EXPENDITURE INCURRED FOR THE PURPOSES OF AND WITH THE VIEW TO COMMENCING A BUSINESS MUST BE REGARDED AS AN ECONOMIC ACTIVITY . IT WOULD BE CONTRARY TO THAT PRINCIPLE IF SUCH AN ACTIVITY DID NOT COMMENCE UNTIL THE PROPERTY WAS ACTUALLY EXPLOITED , THAT IS TO SAY UNTIL IT BEGAN TO YIELD TAXABLE INCOME . ANY OTHER INTERPRETATION OF ARTICLE 4 OF THE SIXTH DIRECTIVE WOULD BURDEN THE TRADER WITH THE COST OF VAT IN THE COURSE OF HIS ECONOMIC ACTIVITY WITHOUT ALLOWING HIM TO DEDUCT IT IN ACCORDANCE WITH ARTICLE 17 AND WOULD CREATE AN ARBITRARY DISTINCTION BETWEEN INVESTMENT EXPENDITURE INCURRED BEFORE ACTUAL EXPLOITATION OF IMMOVABLE PROPERTY AND EXPENDITURE INCURRED DURING EXPLOITATION . EVEN IN CASES IN WHICH THE INPUT TAX PAID ON PREPARATORY TRANSACTIONS IS REFUNDED AFTER THE COMMENCEMENT OF ACTUAL EXPLOITATION OF IMMOVABLE PROPERTY , A FINANCIAL CHARGE WILL ENCUMBER THE PROPERTY DURING THE PERIOD , WHICH MAY SOMETIMES BE CONSIDERABLE , BETWEEN THE FIRST INVESTMENT EXPENDITURE AND THE COMMENCEMENT OF EXPLOITATION . ANYONE WHO CARRIES OUT SUCH INVESTMENT TRANSACTIONS WHICH ARE CLOSELY CONNECTED WITH AND NECESSARY FOR THE FUTURE EXPORTATION OF IMMOVABLE PROPERTY MUST THEREFORE BE REGARDED AS A TAXABLE PERSON WITHIN THE MEANING OF ARTICLE 4 .
24 AS REGARDS THE QUESTION WHETHER ARTICLE 4 MUST BE INTERPRETED AS MEANING THAT A DECLARED INTENTION TO LET FUTURE PROPERTY IS A SUFFICIENT GROUND FOR ASSUMING THAT THE ACQUIRED PROPERTY IS TO BE USED FOR A TAXABLE ACTIVITY AND THAT THEREFORE , ON THAT BASIS , THE INVESTOR MUST BE TREATED AS A TAXABLE PERSON , IT MUST FIRST BE POINTED OUT THAT IT IS FOR THE PERSON APPLYING TO DEDUCT VAT TO SHOW THAT THE CONDITIONS FOR DEDUCTION ARE MET AND IN PARTICULAR THAT HE IS A TAXABLE PERSON . THEREFORE ARTICLE 4 DOES NOT PRECLUDE THE REVENUE AUTHORITIES FROM REQUIRING THE DECLARED INTENTION TO BE SUPPORTED BY OBJECTIVE EVIDENCE SUCH AS PROOF THAT THE PREMISES WHICH IT IS PROPOSED TO CONSTRUCT ARE SPECIFICALLY SUITED TO COMMERCIAL EXPLOITATION .