CJEU judgment – Polish VAT regulations inconsistent with EU law
Today, the Court of Justice of the EU ruled that the provisions of EU law preclude the application of national rules according to which the exercise of the right to deduct VAT related to intra-Community acquisitions of goods (intra-Community acquisition of goods) in the same tax period in which VAT is due is subject to showing the VAT due in the tax declaration, submitted within three months from the end of the month in which the tax obligation arose in relation to the purchased goods.
In practice, the Tribunal found that Polish regulations, in particular concerning intra-Community acquisition or import of services, cannot require taxpayers to recognize the tax obligation in the correct period as a condition for the right to input deduction. Let us recall that this regulation was very problematic, which meant that taxpayers had to temporarily report the tax due themselves or pay interest on tax arrears.
The settlement will be of great practical importance. In particular, in terms of increasing the possibility to deduct input tax and may constitute the basis for the reopening of tax proceedings in which these regulations were applied to the taxpayer.
Judgment of the CJEU of 18 March 2021, file ref. file C-895/19 (A.)