Provisional text

JUDGMENT OF THE COURT (Fourth Chamber)

5 March 2026 (*)

( References for a preliminary ruling – Common system of value added tax (VAT) – Directive 2006/112/EC – Article 98 – Option for the Member States to apply a reduced rate of VAT to certain supplies of goods and services – Short-term accommodation in hotels and similar establishments – Annex III, point (12) – Reduced rate of VAT applicable to accommodation provided in hotels and similar establishments – Supplies that are ancillary to accommodation – National regulations establishing a mechanism for separating taxable transactions – No application of the reduced VAT rate to supplies that are not directly used for the accommodation – Principle of fiscal neutrality )

In Joined Cases C‑409/24 to C‑411/24,

THREE REQUESTS for a preliminary ruling under Article 267 TFEU from the Bundesfinanzhof (Federal Fiscal Court, Germany), made by decisions of 10 January 2024, received at the Court on 12 June 2024, in the proceedings

J-GmbH

v

Finanzamt K (C‑409/24),

and

D

v

Finanzamt F (C‑410/24),

and

D GmbH & Co. KG

v

Finanzamt A (C‑411/24),

THE COURT (Fourth Chamber),

composed of I. Jarukaitis, President of the Chamber, M. Condinanzi, N. Jääskinen, R. Frendo and A. Kornezov (Rapporteur), Judges,

Advocate General: T. Ćapeta,

Registrar: A. Calot Escobar,

having regard to the written procedure,

after considering the observations submitted on behalf of:

–        the German Government, by J. Möller and R. Kanitz, acting as Agents,

–        the European Commission, by F. Behre and M. Herold, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 25 September 2025,

gives the following

Judgment

1        These requests for a preliminary ruling concern the interpretation of Article 24(1) and Article 98(1) and (2) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1; ‘the VAT Directive’) and of point (12) of Annex III to that directive.

2        The requests have been made in three sets of proceedings between, in Case C‑409/24, J-GmbH and Finanzamt K (Tax Office K, Germany), in Case C‑410/24, D and Finanzamt F (Tax Office F, Germany) and, in Case C‑411/24, D GmbH & Co. KG and Finanzamt A (Tax Office A, Germany), concerning the determination of the standard or reduced rate of value added tax (VAT) applicable to the various supplies of services provided in hotels and similar establishments in the context of short-term accommodation services.

 Legal context

 European Union law

3        Under Article 2(1)(c) of the VAT Directive:

‘The following transactions shall be subject to VAT:

…

(c)      the supply of services for consideration within the territory of a Member State by a taxable person acting as such’.

4        Article 24(1) of that directive provides:

‘“Supply of services” shall mean any transaction which does not constitute a supply of goods.’

5        Article 96 of that directive provides:

‘Member States shall apply a standard rate of VAT, which shall be fixed by each Member State as a percentage of the taxable amount and which shall be the same for the supply of goods and for the supply of services.’

6        Article 98(1) and the first subparagraph of Article 98(2) of that directive stipulates as follows:

‘1.      Member States may apply either one or two reduced rates.

2.      The reduced rates shall apply only to supplies of goods or services in the categories set out in Annex III.’

7        Annex III to the VAT Directive, which contains the list of supplies of goods and services to which the reduced rates of VAT referred to in Article 98 may be applied, includes, in point (12):

‘accommodation provided in hotels and similar establishments, including the provision of holiday accommodation and the letting of places on camping or caravan sites’.

 German law

8        The first sentence of Paragraph 1(1) of the Umsatzsteuergesetz (Law on Turnover Tax) of 21 February 2005 (BGBl. 2005 I, p. 386), in the version applicable to the facts in the main proceedings (‘UStG’), provides as follows:

‘The following transactions shall be subject to turnover tax:

(1)      supplies of goods or services effected for consideration within the national territory by a trader in the course of his or her business. …’

9        Article 12 of the UStG provides:

‘(1)      The rate applicable to taxable transactions shall be 19% of the taxable amount …

(2)      The rate of tax shall be reduced to 7% in respect of the following transactions:

…

11.      the renting of living and sleeping spaces offered by a trader for the short-term accommodation of third parties, and the short-term renting of camping pitches. The first sentence shall not apply to supplies that are not directly used for the rental, even if the remuneration for those supplies is covered by the consideration for that rental.’

10      Paragraph 4 of Section 12.16 of the Umsatzsteuer-Anwendungserlass (Ruling on the application of turnover tax) of 1 October 2010 (BStBl. 2010 I, p. 846; ‘UStAE’) provides that, where the following services are supplied alongside accommodation, they are to be subject to the reduced rate of VAT: the making available of furnished rooms and rooms equipped with other furnishings (for example, a television set, radio, telephone, safe); access to electricity; the making available of bed linen, towels and bathrobes; the cleaning of the rented rooms; the provision of personal hygiene tools, items for shoe cleaning and sewing kits; wake-up calls; use of a shoe cleaning machine; accommodation of animals in the rented living quarters and bedrooms.

11      Paragraph 5 of Section 12.16 of the UStAE sets out a non-exhaustive list of supplies which do not qualify for the reduced rate of VAT, even where they are supplies ancillary to short-term accommodation within the meaning of Paragraph 12(2)(11) of the UStG. That list includes the following: the making available of conference rooms; the making available of rooms for the exercise of a professional or commercial activity; the making available of places to park vehicles that has been agreed separately; the making available of non-static motorhomes, caravans, camping trailers, houseboats and yachts; transport in railway sleeping cars; the making available of cabins on ships used for transport; the arranging of accommodation services; turnover from pet boarding; transfers of value for no consideration (for example, self-use of holiday apartments).

 The disputes in the main proceedings and the questions referred for a preliminary ruling

 Case C‑409/24

12      J, a company incorporated under German law, operated a hotel and restaurant with a car park which could be used by its customers without it receiving any remuneration other than that which it received for the accommodation.

13      In addition to the overnight stay, the supply of accommodation also included breakfast. However, customers had the option of forgoing the breakfast, and the cost of the breakfast was then deducted from the total amount invoiced.

14      J argued that the overnight stay, the breakfast and the making available of parking spaces constituted a single supply and, consequently, applied the reduced rate of VAT of 7% to that supply as a whole.

15      Following two tax audits carried out by Tax Office K concerning, inter alia, the period from June 2018 to May 2019, Tax Office K issued two assessment notices in which it found, in essence, that, under the second sentence of Paragraph 12(2)(11) of the UStG, the breakfast and the making available of parking spaces had to be separated from the supply of accommodation and taxed at the standard VAT rate of 19%.

16      J lodged appeals against those notices, which were rejected by Tax Office K by decision of 26 February 2020.

17      That company brought an action against that decision before the Sächsisches Finanzgericht (Finance Court, Saxony, Germany), which, by judgment of 23 September 2020, dismissed it essentially on the ground that the breakfast and the making available of parking spaces were not supplies ancillary to accommodation but rather were independent services. In any event, according to that court, even if those supplies could be classified as being ancillary to the supply of accommodation, Tax Office K had been correct to separate them from it, as required by the applicable national law.

18      J therefore brought an appeal on a point of law against that judgment before the Bundesfinanzhof (Federal Fiscal Court, Germany), which is the referring court.

19      That court takes the view that the Sächsisches Finanzgericht (Finance Court, Saxony) was correct in finding that breakfast, which customers were free to turn down and the price of which would consequently be deducted from the price of the accommodation, constituted an independent supply, which should therefore be subject to the standard rate of VAT.

20      By contrast, that court states that, in the present case, the making available of parking spaces constituted a supply ancillary to the supply of short-term accommodation, given that the total price paid by customers did not vary according to whether or not they used the hotel car park. Nevertheless, since it is not directly used for the short-term accommodation, under the second sentence of Paragraph 12(2)(11) of the UStG, the making available of parking spaces had to be separated from the principal supply consisting of that accommodation and, consequently, had to be excluded from the application of the reduced rate of VAT.

21      In that regard, the referring court takes the view that the VAT Directive does not preclude the requirement laid down in the second sentence of Paragraph 12(2)(11) of the UStG to separate from the supply of short-term accommodation any supplies which are not directly used for such accommodation, since, in principle, that directive, as interpreted by the Court, allows Member States to apply the reduced rate of VAT selectively within the categories of supplies of goods and services listed in Annex III to that directive, provided that the principle of fiscal neutrality is complied with.

22      According to that court, it follows, in essence, from the judgments of 6 May 2010, Commission v France (C‑94/09, EU:C:2010:253), of 22 September 2022, The Escape Center (C‑330/21, EU:C:2022:719) and of 8 February 2024, Valentina Heights (C‑733/22, EU:C:2024:126) that Article 98 of the VAT Directive allows Member States to isolate the concrete and specific aspects of the categories of supplies listed in Annex III and, in compliance with the principle of fiscal neutrality, to apply the reduced rate of VAT only to those concrete and specific aspects.

23      However, that court has doubts as to whether the mechanism for separating taxable transactions provided for in the second sentence of Paragraph 12(2)(11) of the UStG is compatible with the requirements arising from the VAT Directive, in the light of the judgments of 18 January 2018, Stadion Amsterdam (C‑463/16, EU:C:2018:22), and of 4 May 2023, Finanzamt X (Permanently installed equipment and machinery) (C‑516/21, EU:C:2023:372). In that context, that court explains that some German legal academics take the view that ancillary services must be treated in the same way as the principal supply for VAT purposes, with the result that the former cannot be separated from the latter.

24      In those circumstances, the Bundesfinanzhof (Federal Fiscal Court) decided to stay the proceedings and to refer the following question to the Court of Justice:

‘Are Article 24(1) and Article 98(1) and (2) of [the VAT Directive], read in conjunction with Category 12 of Annex III thereto, to be interpreted as meaning that they preclude a national provision such as the second sentence of Paragraph 12(2)(11) of the [UStG], under which a Member State may exclude, by means of a national requirement to break down transactions for tax purposes, supplies from the reduced tax rate provided for by the Member State for the renting of living and sleeping spaces offered by a trader for the short-term provision of accommodation to strangers, which supplies do not directly serve the renting purpose but are remunerated by the consideration for such renting, even if those supplies are dependent supplies ancillary to the short-term provision of accommodation to strangers, such as (only) the provision of parking spaces as in this case?’

 Case C‑410/24

25      In the course of 2013, D operated a guesthouse and offered customers overnight accommodation with breakfast, which was included in the flat-rate overall price, regardless of whether customers chose to have it or not. The invoices showed that price, including taxes.

26      In her VAT return for 2013, D declared both transactions at the reduced VAT rate of 7% and transactions at the standard rate of 19%.

27      On 19 December 2018, referring to the judgment of 18 January 2018, Stadion Amsterdam (C‑463/16, EU:C:2018:22), D sent a request asking Tax Office F to amend the amount of VAT determined in respect of that return. In particular, D requested that all the transactions in the context of short-term accommodation entered into by her be taxed at the reduced VAT rate of 7%, since it is apparent, in essence, from that judgment that a single supply must be taxed at a uniform rate.

28      By decision of 8 February 2019, Tax Office F refused that request.

29      D brought an action for annulment of that decision before the Hessisches Finanzgericht (Finance Court, Hesse, Germany). That court dismissed the action, ruling, in essence, that the breakfasts provided by D were not subject to the reduced VAT rate but to the standard rate, since that reduced rate, provided for in the first sentence of Paragraph 12(2)(11) of the UStG, applied only to the supply of short-term accommodation and the second sentence of that provision laid down a requirement to separate from that supply any services that are not directly used for that supply. The fact that, in the present case, an overall price had been agreed was, according to that court, inconsequential.

30      D lodged an appeal on a point of law against that court’s judgment before the Bundesfinanzhof (Federal Fiscal Court), which is also the referring court in Case C‑410/24, arguing, in essence, that breakfast was a supply ancillary to short-term accommodation since, in principle, the flat-rate overall price included breakfast, regardless of whether or not guests chose to have it.

31      The referring court observes that, unlike in Case C‑409/24, in the present case breakfast is a supply ancillary to short-term accommodation, since – apart from one exception – the overall price paid by customers did not vary depending on whether or not they had breakfast. That being said, according to that court, in order to comply with the second sentence of Paragraph 12(2)(11) of the UStG and the principle of fiscal neutrality, breakfast must be separated from short-term accommodation and be subject to VAT at the standard rate, even though it is a supply that is ancillary to that accommodation.

32      In that context and for the same reasons as those set out in paragraphs 22 and 23 of the present judgment, the referring court has doubts as to whether the requirement in the second sentence of Paragraph 12(2)(11) of the UStG that short-term accommodation be separated from supplies that are not directly used for such accommodation is in line with EU law.

33      In those circumstances, the Bundesfinanzhof (Federal Fiscal Court) decided to stay the proceedings and to refer the following question to the Court of Justice:

‘Are Article 24(1) and Article 98(1) and (2) of [the VAT Directive], read in conjunction with Category 12 of Annex III thereto, to be interpreted as meaning that they preclude a national provision such as the second sentence of Paragraph 12(2)(11) of the [UStG], under which a Member State may exclude, by means of a national requirement to break down transactions for tax purposes, supplies from the reduced tax rate provided for by the Member State for the renting of living and sleeping spaces offered by a trader for the short-term provision of accommodation to strangers, which supplies do not directly serve the renting purpose but are remunerated by the consideration for such renting, even if those supplies are dependent supplies ancillary to the short-term provision of accommodation to strangers, such as the supply of breakfast as in this case?’

 Case C‑411/24

34      In 2011, D GmbH & Co. KG, a company incorporated under German law, operated two hotels with car parks and local wireless networks (wi-fi). One of those two hotels also had a gym and wellness facilities. Guests staying at those hotels could use those amenities and facilities without being invoiced separately.

35      D submitted a VAT return for 2011 to Tax Office A, in which it claimed that the provision of services ancillary to short-term accommodation to customers of the hotels, at no additional cost, should be subject to the reduced rate of VAT.

36      Tax Office A did not accept that analysis and carried out an on-site audit following which it found, in essence, by decision of 30 July 2019, that the making available of a wi-fi network, parking spaces, a gym and wellness facilities constituted transactions subject to VAT at the standard rate of 19%.

37      D brought an action for annulment of that decision before the Finanzgericht (Finance Court, Germany). That court dismissed that action, holding, in essence, that the services referred to in the preceding paragraph of the present judgment constituted supplies made for consideration, within the meaning of Paragraph 1(1)(1) of the UStG, and that, in accordance with the second sentence of Paragraph 12(2)(11) of that law, those supplies could not be subject to the reduced rate of VAT.

38      D brought an appeal on a point of law against the judgment of that court before the Bundesfinanzhof (Federal Fiscal Court), which is also the referring court in that case.

39      The referring court takes the view, in the first place, that the Finanzgericht (Finance Court) was correct in finding that the supplies in question were provided by D for consideration. According to the referring court, the fact that D did not receive remuneration for those supplies separately from the remuneration received for short-term accommodation did not mean that those supplies were provided free of charge.

40      In the second place, according to that court, the making available of a wi-fi network, parking spaces, a gym and wellness facilities constituted supplies ancillary to the principal supply, namely short-term accommodation, and, taken together with that supply, they formed a single supply.

41      In that context, that court has the same doubts as those set out in paragraphs 22 and 23 of the present judgment as regards whether the requirement under the second sentence of Paragraph 12(2)(11) of the UStG, according to which supplies which are not directly used for that accommodation must be separated from short-term accommodation, is in line with EU law.

42      In those circumstances, the Bundesfinanzhof (Federal Fiscal Court) decided to stay the proceedings and to refer the following question to the Court of Justice:

‘Are Article 24(1) and Article 98(1) and (2) of [the VAT Directive], read in conjunction with Category 12 of Annex III thereto, to be interpreted as meaning that they preclude a national provision such as the second sentence of Paragraph 12(2)(11) of the [UStG], under which a Member State may exclude, by means of a national requirement to break down transactions for tax purposes, supplies from the reduced tax rate provided for by the Member State for the renting of living and sleeping spaces offered by a trader for the short-term provision of accommodation to strangers, which supplies do not directly serve the renting purpose but are remunerated by the consideration for such renting, even if those supplies are dependent supplies ancillary to the short-term provision of accommodation to strangers, such as the provision of parking spaces, fitness and wellness facilities and of the hotel’s own wireless local network (Wi-Fi network) as in this case?’

 Procedure before the Court

43      By decision of the President of the Court of 15 July 2024, Cases C‑409/24, C‑410/24 and C‑411/24 were joined for the purposes of the oral part of the procedure and the judgment.

 Consideration of the questions referred

44      By its questions in each of the three joined cases, which should be examined together, the referring court asks, in essence, whether Article 98(1) and (2) of the VAT Directive, read in conjunction with point (12) of Annex III to that directive, must be interpreted as precluding national legislation which excludes from the scope of the reduced VAT rate applicable to short-term accommodation services provided in hotels and similar establishments supplies which are not directly used for that accommodation, such as the making available of parking spaces, a gym and wellness facilities, as well as access to the hotel’s wi-fi network and the provision of breakfast (‘the supplies at issue in the main proceedings’), even though they could be regarded as being ancillary to that accommodation due to the fact that the remuneration for them is covered by the flat-rate overall price paid for all the services supplied in the context of that accommodation.

45      As a preliminary point, the Court notes that it is apparent from the orders for reference that the questions referred for a preliminary ruling are based on the premiss that, because the supplies at issue in the main proceedings are ancillary to the supplies of accommodation referred to in point (12) of Annex III to the VAT Directive, those services come within the scope of the latter provision, read in conjunction with Article 98 of that directive, which allow Member States to apply a reduced rate of VAT to ‘accommodation provided in hotels and similar establishments, including the provision of holiday accommodation and the renting of places on camping or caravan sites’.

46      In that regard, the Court has held previously that supplies that are ancillary to a principal supply that is subject to a reduced rate of VAT may also, on that basis, be subject to the reduced rate (judgment of 22 September 2022, The Escape Center, C‑330/21, EU:C:2022:719, paragraph 41).

47      As regards the question whether the supplies at issue in the main proceedings constitute supplies that are ancillary to the supply of accommodation provided in hotels and similar establishments, as the referring court states in its orders for reference, the Court notes that, according to settled case-law, questions on the interpretation of EU law are referred by a national court in the factual and legislative context which that court is responsible for defining, the accuracy of which is not a matter for the Court to determine (see, to that effect, judgment of 26 March 2020, Kreissparkasse Saarlouis, C‑66/19, EU:C:2020:242, paragraph 30).

48      While it is therefore appropriate to proceed on the basis that the supplies at issue in the main proceedings are supplies that are ancillary to the supplies of accommodation provided in hotels and similar establishments in order to answer the questions referred, the Court nevertheless points out that there is a single supply where two or more components or acts supplied by the taxable person to the customer, being a typical consumer, are so closely linked that they form, objectively, a single, indivisible economic supply, which it would be artificial to split. That is also the case where two or more elements must be regarded as constituting the principal supply whereas, conversely, other elements must be regarded as one or more ancillary supplies and a supply must be regarded as ancillary to a principal supply if it does not constitute for customers an end in itself but a means of better enjoying the principal supply (judgment of 22 September 2022, The Escape Center, C‑330/21, EU:C:2022:719, paragraphs 25 and 26 and the case-law cited).

49      That being said, with regard to the question raised in the present cases as to whether a Member State may nevertheless consider that only the principal supply of a single transaction, consisting of a principal supply and ancillary supplies, will be subject to a reduced VAT rate, it should be noted that, under Article 96 of the VAT Directive, each Member State is to apply the same standard rate of VAT to the supply of goods and the supply of services.

50      As a derogation from that principle, Article 98(1) of that directive gives Member States the option of applying one or two reduced rates of VAT. In accordance with the first subparagraph of Article 98(2) of that directive, the reduced rates of VAT are to apply only to supplies of goods and services in the categories set out in Annex III to that directive.

51      In that regard, it is clear from settled case-law that, where a Member State decides to make use of the possibility afforded under Article 98(1) and (2) of the VAT Directive to apply a reduced rate of VAT to a category of supplies set out in Annex III to that directive, it has, subject to the requirement to observe the principle of fiscal neutrality inherent in the common system of VAT, the possibility of limiting the application of that reduced rate of VAT to concrete and specific aspects of that category (see, to that effect, judgments of 6 May 2010, Commission v France, C‑94/09, EU:C:2010:253, paragraph 28, and of 5 September 2019, Regards Photographiques, C‑145/18, EU:C:2019:668, paragraph 42 and the case-law cited).

52      That possibility is justified, inter alia, by the fact that, since that rate is the exception to the application of the standard rate set by each Member State, the restriction of its application to concrete and specific aspects of the category of supplies in question is consistent with the principle that exemptions or derogations must be interpreted restrictively (judgments of 6 May 2010, Commission v France, C‑94/09, EU:C:2010:253, paragraph 29, and of 5 September 2019, Regards Photographiques, C‑145/18, EU:C:2019:668, paragraph 43 and the case-law cited).

53      However, the exercise of the possibility afforded to Member States to apply selectively the reduced rate of VAT is subject to the twofold condition, first, that they isolate, for the purposes of the application of that reduced rate, only concrete and specific aspects of the category of supply at issue and, secondly, that they comply with the principle of fiscal neutrality (judgment of 8 February 2024, Valentina Heights, C‑733/22, EU:C:2024:126, paragraph 44 and the case-law cited). Those conditions seek to ensure that Member States make use of that possibility only under conditions which ensure the correct and straightforward application of the reduced rate of VAT chosen and the prevention of any possible evasion, avoidance or abuse (judgments of 6 May 2010, Commission v France, C‑94/09, EU:C:2010:253, paragraph 30, and of 5 September 2019, Regards Photographiques, C‑145/18, EU:C:2019:668, paragraph 46 and the case-law cited).

54      In the present case, as regards the first condition referred to in the preceding paragraph of the present judgment, it is necessary to determine whether the supplies of accommodation provided in hotels and similar establishments, for which German legislation provides for the application of a reduced rate of VAT, constitute concrete and specific aspects of the category of supplies listed in point (12) of Annex III to the VAT Directive. To that end, it is necessary to consider whether this involves supplies of services that are, as such, identifiable separately from the other services in that category (see, to that effect, judgments of 6 May 2010, Commission v France, C‑94/09, EU:C:2010:253, paragraph 35, and of 8 February 2024, Valentina Heights, C‑733/22, EU:C:2024:126, paragraph 45 and the case-law cited). Such identification presupposes the existence of objective, clear and precise criteria in the national legislation, determining precisely the supplies to which that legislation limits the application of the reduced rate of VAT (see, to that effect, judgment of 5 September 2019, Regards Photographiques, C‑145/18, EU:C:2019:668, paragraph 49 and the case-law cited).

55      Subject to certain verifications which it is for the referring court to carry out, it is apparent from the information set out in the orders for reference that the Federal Republic of Germany, in exercising the discretion conferred on it under Article 98 of the VAT Directive, identified, on the basis of objective, clear and precise criteria, the concrete and specific supplies of the category of services listed in point (12) of Annex III to the VAT Directive, to which the reduced rate of VAT is applicable.

56      It appears from that information that, in accordance with Paragraph 12(2)(11) of the UStG, adopted for the purpose of transposing Article 98(1) and (2) of the VAT Directive, a reduced VAT rate of 7% is to be applied to the renting of living quarters and bedrooms that an operator makes available for the short-term accommodation of third parties, as well as to the short-term renting of camping pitches, with the exception of supplies that are not directly used for the rental, even if the remuneration for those supplies is covered by the consideration for that rental.

57      In addition, the first and second sentences of Paragraph 4 of Section 12.16 of the UStAE identify the supplies of services that are directly linked to short-term accommodation and which are, consequently, subject to the reduced VAT rate of 7%, namely the making available of furnished rooms and rooms equipped with other furnishings, such as a television set, a radio, a telephone or a safe, access to electricity, the making available of bed linen, towels and bathrobes, the cleaning of the rented rooms, the provision of personal hygiene tools, items for shoe cleaning and sewing kits, wake-up calls, the use of a shoe cleaning machine, and the accommodation of animals in the rented living quarters and bedrooms.

58      Paragraph 5 of Section 12.16 of the UStAE contains a non-exhaustive list of the supplies that may not benefit from the reduced VAT rate of 7%, such as the making available of conference rooms, the making available of rooms for the exercise of a professional or commercial activity, the making available of places to park vehicles that has been agreed separately, the making available of non-static motorhomes, caravans, camping trailers, houseboats and yachts, transport in railway sleeping cars, the making available of cabins on ships used for transport, the arranging of accommodation services, turnover from pet boarding, and transfers of value for no consideration (for example, self-use of holiday apartments).

59      Accordingly, it appears that that information is such as to make it possible to identify with certainty, as such, the supplies comprising the rental of living quarters and bedrooms that an operator makes available for the purpose of short term accommodation to third parties, which are subject to the reduced rate of VAT, and to distinguish them from other supplies provided in the context of that accommodation that come within the scope of point (12) of Annex III to the VAT Directive and are subject to the standard rate of VAT. Therefore, subject to the verifications to be carried out by the referring court, which alone has jurisdiction to interpret national law, the fact that they can be identified appears to meet the requirements set out in paragraph 54 of the present judgment, with the result that the first condition, namely that the concrete and specific aspects of the category of supplies at issue are isolated, is, subject to those verifications, satisfied.

60      That conclusion is not called into question by the fact that it is apparent from the orders for reference that the supplies at issue in the main proceedings, the prices of which form part of a flat-rate overall price which includes the short-stay accommodation, constitute, from the customers’ point of view, supplies that are ancillary to that accommodation.

61      It is clear from the Court’s case-law that, where a Member State has, in accordance with the principle of fiscal neutrality, exercised its discretion and isolated specific and concrete aspects of a category of supplies referred to in Annex III to the VAT Directive, there is no need to examine whether the supplies that are isolated and the supplies that are ancillary to them need or need not be regarded, from the point of view of an average consumer, as a single transaction, since that factor is not decisive for the exercise by Member States of the discretion granted to them by that directive as regards the selective application of the reduced rate of VAT on the basis of general and objective criteria (see, to that effect, judgment of 6 May 2010, Commission v France, C‑94/09, EU:C:2010:253, paragraphs 33 and 34).

62      That interpretation is not called into question by the judgments of 18 January 2018, Stadion Amsterdam (C‑463/16, EU:C:2018:22) and of 4 May 2023, Finanzamt X (Permanently installed equipment and machinery) (C‑516/21, EU:C:2023:372), to which the referring court refers in its orders for reference.

63      It is true that, in paragraph 36 of the judgment of 18 January 2018, Stadion Amsterdam (C‑463/16, EU:C:2018:22), the Court held that a single supply must be taxed solely at the rate applicable to that supply, that rate being determined according to the principal element of that supply. However, in the case that gave rise to that judgment, the Member State concerned had not exercised the discretion afforded to it by the VAT Directive by isolating, for the purpose of applying the reduced rate of VAT, concrete and specific aspects of the category of supplies at issue in that case. It was in those circumstances that the Court found it necessary to examine whether, where that discretion is not exercised, the supplies at issue in that case constituted a single supply from the point of view of the average consumer.

64      In addition, in paragraph 34 of the judgment of 18 January 2018, Stadion Amsterdam (C‑463/16, EU:C:2018:22), the Court noted that, in order to determine whether the selective application of a reduced rate of VAT complied with Article 96 and Article 99(1) of the VAT Directive, the question whether a transaction including several elements must be considered to be a single supply was not decisive for the purpose of the exercise by the Member States of the discretion left to them by that directive as regards the selective application of the reduced rate of VAT. In paragraph 35 of that judgment, the Court also pointed out that the question that had been referred to it, namely the question as to whether a single supply comprised of two separate elements, one being the principal element and the other being ancillary, had to be subject solely to the rate of VAT applicable to the principal element, was different in nature to the question of the scope of that discretion, which was the subject of the case that gave rise to the judgment of 6 May 2010, Commission v France (C‑94/09, EU:C:2010:253).

65      In that regard, there is no contradiction between the judgment of 18 January 2018, Stadion Amsterdam (C‑463/16, EU:C:2018:22) and the judgment of 6 May 2010, Commission v France (C‑94/09, EU:C:2010:253), which concern two different situations. The first concerns whether supplies ancillary to a principal supply must be subject to the standard rate of VAT applicable to that principal supply where the Member State concerned has not exercised the discretion conferred on it under Article 98 of the VAT Directive enabling it to isolate concrete and specific aspects of a category of supplies listed in Annex III to that directive. The second concerns a situation in which the Member State concerned has exercised that discretion.

66      As regards the case which gave rise to the judgment of 4 May 2023, Finanzamt X (Permanently installed equipment and machinery) (C‑516/21, EU:C:2023:372), suffice it to note that, unlike the present cases, that case did not concern the selective application of a reduced rate of VAT to a category of supplies referred to in Annex III to the VAT Directive, but concerned the interpretation of Article 135(1)(l) and point (c) of the first subparagraph of Article 135(2) of that directive, which relate, respectively, to exempt transactions involving the leasing or letting of immovable property and to the transactions excluded from that exemption. In that case, the Court was thus called upon to rule on the exemptions from VAT and the exceptions to those exemptions, as provided for by the VAT Directive itself, and not, as in the present cases, on the scope of the discretion conferred on the Member States by that directive with regard to the selective application of the reduced rate of VAT.

67      As regards the second condition referred to in paragraph 53 of the present judgment, which relates, in essence, to compliance with the principle of fiscal neutrality where a Member State chooses to apply the reduced rate of VAT selectively to certain concrete and specific aspects of the category of supplies listed in Annex III to the VAT Directive, the Court recalls that that principle precludes treating similar goods or supplies of services, which are thus in competition with each other, differently for VAT purposes (judgment of 9 September 2021, Phantasialand, C‑406/20, EU:C:2021:720, paragraph 37 and the case-law cited).

68      According to settled case-law, in order to determine whether goods or services are similar, account must primarily be taken of the point of view of a typical consumer. Goods or services are similar where they have similar characteristics and meet the same needs from the point of view of consumers, the test being whether their use is comparable, and where the differences between them do not have a significant influence on the decision of the average consumer to use one or the other of those goods or services (judgment of 9 September 2021, Phantasialand, C‑406/20, EU:C:2021:720, paragraph 38 and the case-law cited).

69      In other words, it is necessary to determine whether the goods and services at issue are interchangeable from the point of view of an average consumer. If that is the case, the application of different VAT rates might affect the consumer’s choice which, in turn, would indicate an infringement of the principle of fiscal neutrality (judgment of 9 September 2021, Phantasialand, C‑406/20, EU:C:2021:720, paragraphs 39 and the case-law cited).

70      In addition, the Court notes that that principle cannot extend the scope of a reduced rate of VAT in the absence of clear wording to that effect  (judgment of 9 March 2017, Oxycure Belgium, C‑573/15, EU:C:2017:189, paragraph 31).

71      Consequently, for the purposes of examining the second condition referred to in paragraph 53 of this judgment, it is for the referring court to ascertain whether, taken in isolation, supplies of services such as the supplies at issue in the main proceedings, namely breakfast and/or access to parking spaces, gyms, wellness facilities and wi-fi networks, offered by a hotel or similar establishment where accommodation is being supplied, are, in the eyes of that average consumer, similar to those provided independently by another economic operator, with the result that they are interchangeable.

72      Where they are interchangeable, the failure to apply selectively the reduced VAT rate of 7% to breakfast and/or the making available of parking spaces, gyms, wellness facilities and wi-fi networks, and treating them as being subject to the standard VAT rate, even though those supplies are provided as a supply ancillary to short-term accommodation and are included in a flat-rate overall price, would not infringe the principle of fiscal neutrality, to the extent that those supplies, provided independently by another economic operator, are also subject to the standard VAT rate.

73      In that regard, the referring court takes the view that the separation requirement under the second sentence of Article 12(2)(11) of the UStG does not infringe the principle of fiscal neutrality, since it results in the same supply being taxed at the same rate, including where it is ancillary to short-term accommodation. According to that court, in order to comply with the principle of fiscal neutrality, a hotel may not, for example, offer breakfast and/or make available parking spaces, gyms, wellness facilities and wi-fi networks at a VAT rate that is more advantageous than that applicable to the same supplies provided in the immediate vicinity by an economic operator, such as a restaurant, a public car park operator or a sauna operator.

74      In those circumstances and subject to the verifications which it is for the referring court to carry out as regards the considerations set out in paragraphs 71 and 72 of the present judgment, the Court finds that national legislation which, while specifying concrete and specific aspects of the category of supplies referred to in point (12) of Annex III to the VAT Directive to which a reduced rate of VAT may apply, makes it possible to separate from short-term accommodation supplies that are not directly used for that accommodation, such as the supplies at issue in the main proceedings, and to apply to them the standard VAT rate of 19%, even where they constitute supplies that are ancillary to that accommodation, does not appear to be incompatible with the principle of fiscal neutrality.

75      In the light of all the foregoing considerations, the answer to the questions referred is that Article 98(1) and (2) of the VAT Directive, read in conjunction with point (12) of Annex III to that directive, must be interpreted as not precluding national legislation which excludes from the scope of the reduced VAT rate applicable to short-term accommodation services provided in hotels and similar establishments supplies which are not directly used for that accommodation, such as the making available of parking spaces, a gym and wellness facilities, as well as access to the hotel’s wi-fi network and the provision of breakfast, even though they could be regarded as being ancillary to that accommodation due to the fact that the remuneration for them is covered by the flat-rate overall price paid for all the services supplied in the context of that accommodation, provided that those rules make provision for the reduced rate to be applied to concrete and specific aspects of the categories of accommodation services referred to in point (12) of Annex III to that directive and that the principle of fiscal neutrality is complied with.

 Costs

76      Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the referring court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Fourth Chamber) hereby rules:

Article 98(1) and (2) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, read in conjunction with point (12) of Annex III to that directive,

must be interpreted as not precluding national legislation which excludes from the scope of the reduced rate of value added tax applicable to short-term accommodation services provided in hotels and similar establishments supplies which are not directly used for that accommodation, such as the making available of parking spaces, a gym and wellness facilities, as well as access to the hotel’s wi-fi network and the provision of breakfast, even though they could be regarded as being ancillary to that accommodation due to the fact that the remuneration for them is covered by the flat-rate overall price paid for all the services supplied in the context of that accommodation, provided that those rules make provision for the reduced rate to be applied to concrete and specific aspects of the categories of accommodation services referred to in point (12) of Annex III to that directive and that the principle of fiscal neutrality is complied with.

[Signatures]

*      Language of the case: German.