Pro Med Logistik GmbH v Finanzamt Dresden-Süd and Eckard Pongratz v Finanzamt Würzburg mit Außenstelle Ochsenfurt.
Date: 2014-02-27
43. The Court has already held, with regard to the third subparagraph of Article 12(3)(a) of the Sixth Directive, that there is nothing in the text of that provision which requires that it be interpreted as meaning that the reduced rate can be charged only if it is applied to all aspects of a category of supplies covered by Annex H to that directive, with the result that a selective application of the reduced rate cannot be excluded provided that no risk of distortion of competition results (see Case C‑94/09 Commission  v France  [2010] ECR I‑4261, paragraph 25 and the case‑law cited). The Court has also held that, since Article 98(1) and (2) of the VAT Directive in essence repeats the wording of Article 12(3)(a) of the Sixth Directive, the interpretation given by the Court to the earlier provision should be extended to the provision replacing it ( Commission  v France , paragraph 27).
44. The Court has consequently decided that, subject to compliance with the principle of fiscal neutrality inherent in the common system of VAT, Member States may apply a reduced rate of VAT to concrete and specific aspects of a category of supplies covered by Annex III to the VAT Directive and Annex H to the Sixth Directive respectively (see, to that effect, Commission  v France , paragraphs 26 and 27 and the case‑law cited).
45. It follows that the exercise of the possibility granted to the Member States to apply selectively the reduced rate of VAT is subject to the twofold condition, first, that they isolate, for the purposes of the application of the reduced rate, only concrete and specific aspects of the category of supply at issue and, secondly, that they comply with the principle of fiscal neutrality. Those conditions seek to ensure that Member States make use of that possibility only under conditions which ensure the correct and straightforward application of the reduced rate chosen and the prevention of any possible evasion, avoidance or abuse (see Commission  v France , paragraph 30).
47. In order to determine whether the local transport of passengers by taxi constitutes a concrete and specific aspect of the supply of services by undertakings for the transport of passengers and their accompanying luggage, it is necessary to consider whether this involves a service which is, as such, identifiable separately from the other services in that category (see, by analogy, Commission  v France , paragraph 35).
52. According to well-established case-law, the principle of fiscal neutrality precludes, in particular, treating similar goods or supplies of services, which are thus in competition with each other, differently for VAT purposes (see Joined Cases C‑259/10 and C‑260/10 The Rank Group  [2011] ECR I‑10947, paragraph 32 and the case-law cited).
53. In order to determine whether two supplies of services are similar within the meaning of that case-law, account must primarily be taken of the point of view of a typical consumer, avoiding artificial distinctions based on insignificant differences (see The Rank Group , paragraph 43 and the case-law cited).
54. Two supplies of services are therefore similar where they have similar characteristics and meet the same needs from the point of view of consumers, the test being whether their use is comparable, and where the differences between them do not have a significant influence on the decision of the average consumer to use one such service or the other (see The Rank Group , paragraph 44 and the case-law cited).
55. In addition, it must be observed that the assessment of the comparability of the services supplied hinges not only on the comparison of individual services, but also on the context in which those services are supplied (see Case C‑357/07 TNT Post UK  [2009] ECR I‑3025, paragraph 38).
56. In that regard, the Court has accepted that, in certain exceptional cases, having regard to the specific characteristics of the sectors in question, differences in the regulatory framework or the legal regime governing the supplies of goods or services at issue may create a distinction in the eyes of the consumer, in terms of the satisfaction of his own needs (see, to that effect, The Rank Group , paragraph 50 and the case-law cited).