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Brussels, 26 June 2008

VAT – Commission takes steps against Poland with regard to the application of VAT on certain cross-border passenger transport services

The European Commission has formally requested Poland to bring its national rules on the application of VAT to cross-border passenger transport services (i.e. buses registered abroad), into line with the provisions of the VAT Directive. The request takes the form of a reasoned opinion (second step of the infringement procedure provided for in Article 226 of the EC Treaty). If, within two months, the relevant national provisions are not amended so as to comply with the reasoned opinion, the Commission may decide to refer this matter to the European Court of Justice.

According to the VAT Directive, cross-frontier transport services are subject to VAT in each Member State for the distance travelled therein. Poland has introduced a particular VAT scheme for cross-border passenger transport services supplied on an occasional basis by means of buses registered abroad. This scheme, which applies to the part of the transport taxable in Poland, entails basically the following:

  • the bus driver is asked to pay the tax in a customs office when the bus enters Poland;
  • the amount of the tax is established for each passenger at 7% of PLN 285;
  • the transport company is not allowed to recover any VAT borne in Poland.

Thus, the scheme leads to VAT due in Poland being collected through payment at the border of an amount calculated on the basis of an average taxable amount per traveller. This scheme deviates from the Community rules since, according to the VAT Directive:

  • VAT due by the supplier of the transport service must be declared and paid by means of a VAT return and not through a one-off payment at the border;
  • the amount of the tax due results from the application of the VAT rate to the part of the total consideration paid for the transport service which is proportional to the distance travelled in Poland;
  • the transport company must be allowed to deduct VAT borne in Poland in the periodical return.

Furthermore, the Polish provisions lead to fiscal cross border controls, thus contravening the essential principles of the common system of VAT.

For these reasons, the Commission has formally requested Poland to change its legislation.

The Commission's reference number is 2007/4139.

For the press releases issued on infringement procedures in the taxation or customs area see:

For the latest general information on infringement measures against Member States see:

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