C-596/10 Commission v France

Judgment · Court of Justice · France · 8 March 2012

France's reduced rate on horses and other equidae

What is the case?

France applied reduced rates of VAT to transactions relating to equidae, and to horses in particular, across the board. Sales, and related supplies, without distinguishing according to the use to which the animal was put. Annex III to the VAT Directive permits a reduced rate for foodstuffs and for supplies of goods and services of a kind normally intended for use in agricultural production, but a horse kept for sport, leisure or racing falls within neither. The Commission brought infringement proceedings. Ireland intervened in support of France.

What is the Court asked?

Whether the application of reduced rates of VAT to transactions relating to equidae, and in particular to horses, where those animals are not as a matter of course intended for use in the preparation of foodstuffs or in agricultural production, is compatible with Articles 96 to 99 of Directive 2006/112 read with Annex III thereto.

The Court’s decision

The Court upheld the action. By applying reduced rates to transactions relating to equidae, and in particular to horses, when those animals are not as a matter of course intended for use in the preparation of foodstuffs or in agricultural production, France failed to fulfil its obligations under Articles 96 to 99 read with Annex III. France was ordered to pay the costs and Ireland to bear its own. One of a series of infringement actions on the equine sector decided around the same time against several Member States.

AI-generated and factual. Not an official document: verify against the text below.

Legislation interpreted

Article 96 of Directive 2006/112/EC Standard rate

Subject matter

Failure of a Member State to fulfil obligations · Value added tax · Directive 2006/112/EC · Application of reduced VAT rates to transactions concerning equidae and in particular to horses

Topics

VAT rates

Record

Court: Court of Justice
Case number: C-596/10
ECLI: ECLI:EU:C:2012:130
Official texts: Judgment of 8 March 2012 (62010CJ0596)
Cite as: Judgment of 8 March 2012, Commission v France, C-596/10, EU:C:2012:130

Judgment of 8 March 2012

Text as published by the Court on EUR-Lex, CELEX 62010CJ0596.

Judgment of the Court (Seventh Chamber) of 8 March 2012 —Commission v France(Case C-596/10)

Failure of a Member State to fulfil obligations — Value added tax — Directive 2006/112/EC — Application of reduced VAT rates to transactions concerning equidae and in particular to horses

1. Tax provisions — Harmonisation of laws — Turnover taxes — Common system of value added tax — Rate of the tax — Discretionary power of the Member States to apply a reduced rate to certain supplies of goods and services (Council Directive 2006/112, Arts 96 to 99 and Annex III, paras 1 and 11) (see paras 46, 47, 76, 80 and operative part.)

2. Tax provisions — Harmonisation of laws — Turnover taxes — Common system of value added tax — Rate of the tax — Discretionary power of the Member States temporarily to apply a reduced rate — Conditions (Council Directive 2006/112, Arts 99 and 110) (see paras 74, 75, 77)

Re:

Operative part

The Court:

Declares that, by applying reduced rates of value added tax to transactions relating to equidae and, in particular, to horses, when the latter are not as a matter of course intended for use in the preparation of foodstuffs or in agricultural production, the French Republic has failed to fulfil its obligations under Articles 96 to 99 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, read in conjunction with Annex III thereto;

Signatures

Orders the French Republic to pay the costs;

Orders Ireland to bear its own costs.