Keywords
Summary

Keywords

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Tax provisions - Harmonization of laws - Turnover taxes - Common system of value-added tax - Taxable amount - Supply of goods - Consideration directly linked to the supply, capable of being expressed in monetary terms and constituting a subjective value - Reduction of sale price by way of reward for a service provided by the purchaser

( Council Directive 77/388, Art . 11 A 1 ( a ) )

Summary

The taxable basis for a supply of goods within the meaning of Article 11 A 1 ( a ) of the Sixth Directive ( 77/388 ) is made up of everything which is received directly in connection with the supply and represents the consideration for it, the latter being a subjective value which must be capable of being expressed in monetary terms .

That provision must therefore be interpreted as meaning that where a supplier (" the wholesaler ") supplies goods (" the inducement ") to another (" the retailer ") for a monetary consideration ( namely a sum of money ) which is less than that at which he supplies identical goods to the retailer for resale to the public on an undertaking by the retailer to apply the inducement in procuring another person to arrange, or in rewarding another for arranging, a gathering at which further goods of the wholesaler can be sold by the retailer to the public for their mutual benefit, on the understanding that if no such gathering is held the inducment must be returned to the supplier or paid for at its wholesale price, the taxable amount is the sum of the monetary consideration and of the value of the service provided by the retailer which consists in applying the inducement to procure the services of another person or in rewarding that person for those services; the value of that service must be regarded as being equal to the difference between the price actually paid for that product and its normal wholesale price .