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IP/ 09/1459

Brussels, 8 October 2009

Reduced rate of VAT on horses : the European Commission refers Austria, France, Germany and Luxembourg to the Court of Justice

The European Commission has decided to refer Austria, France, Germany and Luxembourg to the Court of Justice of the European Communities because they are applying a reduced rate of VAT to horses, and in particular race horses.

Annex III of the VAT Directive contains a limited list of supplies of goods and services which may be subject to reduced rates of VAT. Included in that list are foodstuffs for human and animal consumption , live animals, seeds, plants and ingredients normally intended for use in the preparation of foodstuffs (point 1) and agricultural inputs (point 11).

Reduced rates constitute exceptions to the general principle that the standard rate applies, and the legislation must therefore be strictly interpreted. Reduced rates may not be applied to the supply of animals kept as pets (dogs, cats, dwarf-rabbits, guinea pigs, canaries, etc.) nor to ponies and pet or race horses, since these are not intended for human or animal consumption. In addition, the concept of agricultural inputs, which refers to the delivery of goods used on agricultural holdings, does not apply to the delivery of pet or race horses.

In November 2008, the Commission decided to send a reasoned opinion to Germany, Austria, France and Luxembourg (see IP/08/1812 ). Since the Member States concerned did not amend their legislation by the deadline laid down, the Commission has decided to bring the matter before the Court of Justice. A similar case concerning the Netherlands has already been brought before the Court (Case C-09/41).

The reference numbers for these cases are : 2007/4167 (Austria), 2007/4169 (France), 2007/4168 (Germany) and 2007/4170 (Luxembourg).

Press releases on infringement proceedings in the field of taxation and customs can be consulted at:

The latest general information on infringement proceedings against Member States can be found at:

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