Europa An action by the Commission pursuant to Article 169 of the Treaty against a Member State for failure to fulfil its obligations, the bringing of which is a matter for the Commission in its entire discretion, is objective in nature. In the context of the balance of powers between the institutions laid down in the Treaty, it is not for the Court to consider what objectives are pursued in such an action. Its role is to decide whether or not the Member State in question has failed to fulfil its obligations as alleged.
The identification of ‘cleary defined social reasons’ for which certain reduced rates and exemptions from value-added tax may be retained on a transitional basis pursuant to the last indent of Article 17 of the Second Directive and Article 28 (2) of the Sixth Directive is in principle a matter of political choice for the Member States and can be the subject-matter of supervision at the Community level only in so far as, by distorting that concept, it leads to measures which because of their effects and their true objectives lie outside its scope. Since, under the general scheme of value-added tax, the final consumer is the person who acquires goods or services for personal use, as opposed to an economic activity, and thus bears the tax, the second condition laid down in those provisions for the retention of certain reduced rates and exemptions, that is to say that they must be ‘for the benefit of the final consumer’ must in the light of the social purpose of Article 17 be understood as meaning that the beneficiary must not use exempted goods or services in the course of an economic activity. The provision of goods or services at a stage higher in the production or distribution chain which is nevertheless sufficiently close to the consumer to be of advantage to him must also be considered to be for the benefit of the final consumer as so defined.
‘With regard to buildings intended for housing, the Commission’s arguments cannot be upheld. The measures adopted by the United Kingdom to implement its social policy in housing matters, that is to say, facilitating home ownership for the whole population, fall within the purview of ‘social reasons’ for the purposes of the last indent of article 17 of the Second Directive.’
Judges:
Advocate General Darmon
Citations:
C-416/85, [1990] 2 QB 130, [1988] EUECJ C-416/85, [1988] STC 456
Links:
Cited by:
Cited – Her Majesty’s Commissioners of Customs and Excise v Zielinski Baker and Partners Limited HL 26-Feb-2004
The commissioners sought to charge to VAT charges for works which had been carried out to a building within the curtilage of a listed building. The taxpayer sought zero-rating.
Held: The outbuilding to which alterations were made must have . .
Cited – Revenue and Customs v Jacobs CA 22-Jul-2005
The taxpayer had converted a former residentional boarding school into a substantial private residence. He had sought to claim over andpound;300,000 VAT inputs. The Commissioners appealed the finding that he was so entitled.
Held: ‘works . .
Cited – Mason v Boscawen ChD 18-Dec-2008
The landlord had opted to charge VAT on part of the rent. The tenant fell into arrears and now challenged a notice to quit which included the VAT. The court was asked what constituted ‘rent’ for the purposes of a demand for rent founding a notice to . .
Lists of cited by and citing cases may be incomplete.
European, VAT
Updated: 22 May 2022; Ref: scu.134303