A cosmetics wholesaler offered to a beauty consultant, acting as retailer, a pot of rejuvenating cream at the special price of andpound;1.50. The consultant was to give the cream to a chosen retail customer (referred to as a hostess) as a reward for the hostess arranging a sales party, and the special price was available only if the sales party was actually held. The issue was as to the quantification of the consideration received by the wholesaler from the consultant.
Held: ‘In the present case, the parties to the contract have reduced the wholesale price of the pot of cream [andpound;10.14] by a specific amount [andpound;8.64] in exchange for the supply of a service by the beauty consultant which consists in procuring hostesses to arrange sales parties by offering them the pots of cream as gifts. In those circumstances, it is possible to ascertain the monetary value which the two parties to the contract attributed to that service; that value must be considered to be the difference [andpound;8.64] between the price actually paid [andpound;1.50] and the normal wholesale price [andpound;10.14].’
Citations:
C-230/87, [1988] ECR 6365
Cited by:
Cited – Lex Services plc v Her Majestys Commissioners of Customs and Excise HL 4-Dec-2003
When taking a car in part exchange, the company would initially offer the correct market value. If the customer wanted, the company would agree a higher price. When cars were returned, the company at first reclaimed the VAT on the re-purchase price, . .
Followed – Rosgill Group Ltd v Commissioners of Customs and Excise CA 23-Apr-1997
A party hostess had been allowed to buy for pounds 20.76 a blouse with a catalogue price of pounds 27.99.
Held: The monetary equivalent of the consideration for the hostess’s services in arranging the party was the difference pounds 7.23: ‘The . .
Distinguished – Empire Stores v Commissioners of Customs and Excise ECJ 2-Jun-1994
A retail mail-order supplier, had run two promotions, a ‘self-introduction’ scheme and a ‘introduce a friend’ scheme. Under either scheme the introducer (once she or her friend had been approved, placed an order and paid for it) became entitled to . .
Cited – Commissioners of Customs and Excise v Westmorland Motorway Services Ltd CA 5-Feb-1998
Westmorland ran motorway service stations. Its practice, known to coach drivers, was to provide, without payment, a packet of cigarettes and a self-service meal (chosen from its usual menu) to any coach driver who brought a coach with at least . .
Lists of cited by and citing cases may be incomplete.
European, VAT
Updated: 11 April 2022; Ref: scu.134683