C-69/11 Connoisseur Belgium

Order · Court of Justice · Belgium · 9 December 2011

No VAT on amounts that could have been charged but were not

What is the case?

Connoisseur Belgium was in dispute with the Belgian State over the taxable amount of its supplies. Under its contracts it would have been entitled to charge certain costs or amounts to the other contracting party, but in fact it did not do so and never invoiced them. The Belgian authorities nonetheless sought to include those amounts in the taxable amount, on the footing that the contract permitted them to be recovered.

What is the Court asked?

Whether, on a proper construction of Article 11(A)(1)(a) of the Sixth Directive, VAT is due on costs or amounts which the taxable person could contractually have charged to the other contracting party but did not charge.

The Court’s decision

Ruling by order, the Court held that in circumstances such as those of the main proceedings VAT is not due on such amounts. The taxable amount is the consideration actually obtained by the supplier, not the consideration it might have obtained had it exercised a contractual entitlement. A charge that was never made forms no part of what was received in return for the supply. Short but pointed, and it settles an argument administrations occasionally run from the terms of a contract rather than from what was invoiced and paid.

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

Legislation interpreted

Article 11 of Sixth Directive 77/388/EEC Taxable amount

Subject matter

Sixth VAT Directive · Article 11(A)(1)(a) · Taxable amount · Costs not charged by the taxable person

Topics

Supply of goods or services · Taxable amount · Costs not charged by the taxable person

Record

Court: Court of Justice
Case number: C-69/11
ECLI: ECLI:EU:C:2011:825
Official texts: Order of 9 December 2011 (62011CO0069)
Cite as: Order of 9 December 2011, Connoisseur Belgium, C-69/11, EU:C:2011:825

Order of 9 December 2011

Text as published by the Court on EUR-Lex, CELEX 62011CO0069.

Order of the Court (Eighth Chamber) of 9 December 2011 – Connoisseur Belgium v Belgische Staat

(Case C‑69/11)

Article 104(3), first subparagraph, of the Rules of Procedure – Sixth VAT Directive – Article 11(A)(1)(a) – Taxable amount – Costs not charged by the taxable person

Tax provisions – Harmonisation of laws – Turnover taxes – Common system of value added tax – Taxable amount – Provision of services – Consideration actually received by the provider – Costs that were not charged but that could have been under the contract – Excluded (Council Directive 77/388, Art. 11(A)(1)(a)) (see para. 22, operative part)

Re:

Operative part

On a proper construction of Article 11(A)(1)(a) of Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes – Common system of value added tax: uniform basis of assessment, in circumstances such as those of the case in the main proceedings, value added tax is not due on costs or amounts that could contractually have been charged, but were not, by the taxable person to the other contracting party.