On July 22, 2016 the European Commission published its “July infringements package: key decisions”. The July infringements package includes two key decisions in the area of Taxation and Customs Union. And both of these are reasoned opinions issued to Austria. In the first reasoned opinion the European Commission requests Austria to amend its rules on the VAT treatment of resale rights of works of art. In the second reasoned opinion the European Commission calls on Austria to amend certain rules requiring non-resident taxpayers to appoint fiscal representatives.
In the European Commission’s “July infringements package: key decisions” the following is mentioned regarding these two reasoned opinions.
The Commission’s request to Austria to amend its rules on the VAT treatment of resale rights of works of art
“The Commission has requested Austria to change its rules on the value-added tax (VAT) treatment of resale rights on works of art. Resale rights – which give rise to what are commonly known as 'royalties' - constitute an intellectual property right which allows an artist to receive a percentage of the sale price of a work of art when it is resold. In Austria, VAT is charged on the resale of works of art. As there is no contractual relationship of any kind between the buyer and the artist, the Commission considers that such a provision is an infringement of Article 2 of the VAT Directive (Council Directive 2006/112/EC). This is also in line with a judgment of the Court of Justice of the EU (C-16/93, Tolsma) which held that there must be a legal relationship between the provider of a service and the recipient for that service to be taxable. A letter of formal notice was sent to Austria on 17 October 2014. The request takes the form of a reasoned opinion. If there is no satisfactory reaction to the reasoned opinion within two months, the Commission may decide to refer the matter to the Court of Justice of the EU.”
The Commission’s call on Austria to amend certain rules requiring non-resident taxpayers to appoint fiscal representatives
“The Commission has called on Austria to change its rules which require non-resident taxpayers to appoint representatives to administer their tax affairs on their behalf. Persons resident in Austria do not have to comply with this legislation. The Commission considers that these rules result in discriminatory treatment on the grounds of nationality and are contrary to the right to free movement of goods, capital, services and people as laid down in Articles 18, 21, 45, 56 and 63 of the Treaty on the Functioning of the European Union (TFEU) and Articles 4, 28, 36 and 40 of the Agreement of the European Economic Area (EEA Agreement). A letter of formal notice was sent to Austria on 31 March 2014. The request takes the form of a reasoned opinion. If there is no satisfactory reaction to the reasoned opinion within two months, the Commission may decide to refer the matter to the Court of Justice of the EU. ”
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