EU pushes for Skandia implementation

Sat 7th Jan 2017

The European Commission’s VAT Committee has called for a full imposition of the Skandia tax case.

The European Court of Justice case considered whether EU transactions between a foreign bank branch and its headquarters should be including in VAT groupings. Currently, see table below, there are significant variations between member states. The VAT Committee’s recommendations are non-binding.

Member state Latest position
Cyprus, Finland, Germany, Spain (advanced method) The intention of these member states is uncertain
Austria, Ireland, the Netherlands, UK It is not expected that these member states to apply ‘establishment only’ VAT grouping to create intra-establishment supplies when the establishment in the member state is VAT grouped
Italy, Romania, Spain (basic method) These types of ‘VAT grouping’ are purely administrative, treating each member as a separate taxable person and just amalgamating their VAT figures on a single return.
Belgium, the Czech Republic, Denmark, Estonia, Hungary, Latvia, Slovakia, Sweden It is expected that these member states to apply ‘establishment only’ VAT grouping to create intra-establishment supplies when the establishment in the member state is VAT grouped
Bulgaria, Croatia, France, Greece, Lithuania, Luxembourg, Malta, Poland, Portugal, Slovenia These member states do not have VAT grouping


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