Case C‑101/16

SC Paper Consult SRL

v

Direcţia Regională a Finanţelor Publice Cluj-Napoca
and
Administraţia Judeţeană a Finanţelor Publice Bistriţa Năsăud

(Request for a preliminary ruling from the Curtea de Apel Cluj)

(Reference for a preliminary ruling — Taxation — Value added tax (VAT) — Directive 2006/112/EC — Right to deduct — Conditions governing the exercise of that right — Article 273 — National measures — Fight against tax evasion and tax avoidance — Invoice issued by a taxpayer declared ‘inactive’ by the tax authorities — Risk of tax evasion — Refusal of the right to deduct — Proportionality — Refusal to take into account evidence of the absence of tax evasion or tax losses — Limitation of the temporal effects of the judgment to be delivered — No limitation)

Summary — Judgment of the Court (Second Chamber), 19 October 2017

  1. Harmonisation of fiscal legislation—Common system of value added tax—Deduction of input tax—National legislation excluding the right to deduct where a transaction is entered into with taxpayers declared inactive—Obligations of the taxable person—Consultation of a public list of taxpayers declared inactive by the tax authorities—Refusal of the right to deduct imposed systematically and definitely without allowing evidence that there was no tax evasion or loss of tax revenue to be adduced—Not permissible

    (Council Directive 2006/112, as amended by Directive 2010/45)

  2. Questions referred for a preliminary ruling—Interpretation—Temporal effects of judgments by way of interpretation—Retroactive effect—Limitation by the Court—Conditions—Good faith of those concerned—Requirements—Existence of exceptional circumstances

    (Art. 267 TFEU)

  1.  Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax must be interpreted as precluding national rules, such as those at issue in the main proceedings, under which the right to deduct value added tax is refused to a taxable person on the ground that the trader which supplied a service to that taxable person and issued a corresponding invoice, on which the expenditure and the value added tax are indicated separately, has been declared inactive by the tax authorities of a Member State, that declaration of inactivity being public and accessible on the internet to any taxable person in that State, in the case where that refusal of the right to deduct is systematic and final, making it impossible to adduce evidence that there was no tax evasion or loss of tax revenue.

    In accordance with the first paragraph of Article 273 of Directive 2006/112, Member States may impose obligations, other than those provided for by that directive, if they consider such obligations necessary to ensure the correct collection of VAT and to prevent evasion.

    However, the measures adopted by the Member States must not go beyond what is necessary to achieve the objectives pursued. Therefore, they cannot be used in such a way that they would have the effect of systematically undermining the right to deduct VAT and, consequently, the neutrality of VAT (judgments of 21 March 2000, Gabalfrisa and Others, C‑110/98 to C‑147/98, EU:C:2000:145, paragraph 52, and of 21 June 2012, Mahagében and Dávid, C‑80/11 and C‑142/11, EU:C:2012:373, paragraph 57).

    On several occasions, the Court has held that the authorities may not oblige a taxable person to undertake complex and far-reaching checks as to that person’s supplier, thereby de facto transferring their own investigative tasks to that person (see, to that effect, judgments of 21 June 2012, Mahagében and Dávid, C‑80/11 and C‑142/11, EU:C:2012:373, paragraph 65, and of 31 January 2013, Stroy trans, C‑642/11, EU:C:2013:54, paragraph 50).

    By contrast, it is not contrary to EU law to require a trader to take every step which could reasonably be required of him to satisfy himself that the transaction which he is carrying out does not result in his participation in tax evasion (see, to that effect, judgments of 27 September 2007, Teleos and Others, C‑409/04, EU:C:2007:548, paragraphs 65 and 68, and of 21 June 2012, Mahagében and Dávid, C‑80/11 and C‑142/11, EU:C:2012:373, paragraph 54).

    The national rules at issue in the main proceedings do not transfer to the taxable person the monitoring tasks devolving on the authorities, but inform him of the outcome of an administrative investigation from which it is apparent that the taxpayer declared inactive can no longer be monitored by the competent authority, either because that taxpayer no longer met the statutory reporting obligations, or because it has declared information identifying its registered office that does not enable the tax authority concerned to identify it, or because it does not carry on its activity at the registered office or declared tax domicile. The only obligation imposed on the taxable person is, in fact, to consult the list of taxpayers declared inactive displayed at the national administration’s headquarters and published on its website, such a verification being, in addition, straightforward to carry out.

    However, the impossibility, for the taxable person, to demonstrate that the transactions concluded with the trader declared inactive meet the conditions laid down by Directive 2006/112 and, in particular, that the VAT has been paid into the public purse by that trader, goes beyond what is necessary to attain the legitimate objective pursued by that directive.

    (see paras 49-54, 60, 61, operative part)

  2.  See the text of the decision.

    (see paras 64-67)