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:
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:
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.
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