[1] The principles developed by the jurisprudence of the Court and illustrated in this Staff Working Document are in principle applicable to any type of motor vehicle including motorcycles, small vans, boats although almost all the judgments delivered by the Court have dealt with registration taxes levied on passenger cars.
[2] In a judgment of 16 February 2012, case C-118/11 Eon Aset Menidjmunt OOD, the Court has clarified that also the financial leasing of a vehicle may have to be treated as the supply of a good, rather than the supply of a service, if certain requirements are fulfilled, namely the transfer of the ownership to the lessee on expiry of the contract, the transfer of all rewards and risks incidental to the ownership of the vehicle to the lessee, and the equivalence of the value of the leasing payments with the market value of the vehicle.
[3] Directive 2006/112/EC on the common system of value added tax, OJ L 347 of 11.12.2006, p. 1.
[4] For a purchase of a new sailing boat and transport by the owner to his country of residence, see case C-84/09 X v Skatteverket.
[5] See case X v Skatteverket, paragraphs 44, 45, 47 and 50.
[6] Articles 311-325 of the VAT Directive foresee a special scheme for second hand goods supplied by a taxable dealer, the so-called "margin scheme". Several conditions must be fulfilled on the side of the taxable dealer for being subject to this special scheme (which, in any case, is an optional scheme for him). This special scheme applies to the supplies of second-hand goods performed by a taxable dealer where the goods have been supplied to that taxable dealer within the Community by a non-taxable person, by another taxable person who is not entitled to a deduction or by another taxable dealer. In practice the purchase of a vehicle from a taxable dealer who applies the special scheme will entail that no VAT is charged separately on the supply. The margin scheme does not apply where the means of transport is "new" in the terms defined by the VAT Directive (see paragraph 2.1) and the means of transport is dispatched or transported from one Member State to another. Where the scheme applies, the taxable dealer will be subject to VAT only on his profit margin (i.e., the equal to the difference between the selling price charged by the taxable dealer and the purchase price paid by him).
[7] Articles 326-332 of the VAT Directive allow Member States which, before 31 December 1992, had put in place a special tax arrangement other than the "margin scheme", to continue to apply those arrangements pending the adoption of the definitive arrangements concerning the VAT system.
[8] Harmonisation in the field of indirect taxes has been difficult to achieve due to the unanimity requirement under Article 113 TFEU.
[9] Annex IV provides an overview of the very different tax bases and levels applied by Member States.
[10] Judgment of 15 July 2004, case C-365/02, Marie Lindfors, ECR [2004] Page I-7183, paragraph 34 and Judgment of 29 April 2004, case C-387/01, Harald Weigel, Ingrid Weigel v. Finanzlandesdirektion für Vorarlberg, ECR[2004] Page I-4981, paragraph 55.
[11] The simplification of procedures related to the re-registration and de-registration is addressed in a proposal for a Regulation of the European Parliament and of the Council simplifying the transfer of motor vehicles registered in another Member State within the Single Market COM(2012)164. Although the proposed Regulation does not deal with taxation, the situations described in this Staff Working Document concerning the use of cars in a Member State other than the one of registration may have to be reconsidered at a later stage in the light of the outcome of discussions on the aforementioned proposal.
[12] This depends on whether a Member State applies such tax. An overview of the practice of Member States, which can be found in Annex I to this Staff Working Document, shows that 18 of the 27 Member States apply a registration tax.
[13] Case C-387/01, Weigel, paragraph 67.
[14] Judgment of 2 April 1998, case C-213/96 Outokumpu Oy, ECR [1998] Page I-01777, paragraph 34 and Judgment of 18 January 2007, case C-313/05 Maciej Brzezinski v. Dyrektor Izby Celnej w Warszawie, ECR [2007] Page I-00513, paragraph 29.
[15] Judgment of 11 December 1990, case C-47/88, Commission of the European Communities v. Kingdom of Denmark, ECR [1990], Page I-04509, paragraph 17.
[16] For limitations to the application of Article 110 TFEU in situations where no national production of vehicle exists in a Member State, see Judgment of 17 June 2003, C-383/01, De Danske Bilimportører v. Skatteministeriet, ECR [2003] Page I-06065, paragraphs 38-39. The Court held that a registration duty imposed on new imported motor vehicles is not covered by the prohibitions laid down in Article 110 TFEU where there is no similar or competing domestic production. In particular, that provision does not provide a basis for censuring the excessiveness of the level of taxation which the Member States might adopt for particular products, in the absence of any discriminatory or protective effect.
[17] Judgment of 5 October 2006, joined cases C-290/05 and C-335/05 Ákos Nádasdi v Vám- és Pénzügyőrség Észak-Alföldi Regionális Parancsnoksága (C-290/05) and Ilona Németh v Vám- és Pénzügyőrség Dél-Alföldi Regionális Parancsnoksága (C-333/05), ECR [2006] Page I-10115.
[18] In particular, in Nádasdi the Court declared that notwithstanding the introduction of a new tax, the comparison that should be made for the assessment of a potential discrimination under Article 110 TFEU, is not between imported products which were subject to the "new" tax and domestic similar ones which did not bear the "new" tax, but between imported products and similar domestic ones both registered after the "new" tax has been introduced. In this case the final outcome was that the specific tax which was based on technical and environmental characteristics of the vehicle (as such legitimate and objective) did not comply with Article 110 TFEU because it did not take into account the actual depreciation of the vehicle.
[19] Judgment of 7 April 2011, case C-402/09 Ioan Tatu v Statul român prin Ministerul Finanţelor şi Economiei and Others, paragraphs 52 and 53.
[20] Case C-47/88 Commission v Denmark, paragraph 20, and Judgment of 9 March 1995, case C-345/93 Fazenda Pública and Ministério Público v Américo João Nunes Tadeu, paragraph 13.
[21] Cases C-47/88 Commission v Denmark and C-345/93 Nunes Tadeu.
[22] Judgment of the Court of 23 October 1997, case C-375/95, Commission of the European Communities v. Hellenic Republic ECR [1997] Page I-05981, and Judgment of 19 September 2002, case C-101/00, Tulliasiamies, Antti Siilin, ECR [2002] Page I-07487.
[23] Judgment of 27 February 2001, case C-393/98, Ministério Público and António Gomes Valente v Fazenda Pública ECR [2001] Page I-01327, paragraph 28, and case C-74/06, Commission v Greece, paragraph 40.
[24] See case C-47/88 Commission v Denmark, paragraph 18.
[25] See case C-74/06 Commission v Greece, paragraph 56.
[26] See case C-393/98 Gomes Valente, paragraph 34.
[27] Council Directive 83/182/EEC of 28 March 1983 on tax exemptions within the Community for certain means of transport temporarily imported into one Member State from another, OJ L 105 of 23.04.1983, p. 59-63.
[28] Council Directive 2009/55/EC of 25 May 2009 on tax exemptions applicable to the permanent introduction from a Member State of the personal property of individuals, OJ L 145 of 10.06.2009, p. 36-41.
[29] Council Directive 83/183/EEC on tax exemptions applicable to permanent imports from a Member State of the personal property of individuals, OJ L 105 of 23.04.1983, p. 64-65.
[30] Further to those taxes, Article 1 of Directive 83/182/EEC provides for an exemption from other taxes listed in the Annex to the Directive.
[31] In addition, also bicycles, tricycles and saddle-horses.
[32] Case C-144/08 Commission of the European Communities v Republic of Finland, ECR [2009] Page I-00097.
[33] Judgment of 12 July 2001, case C-262/99 Paraskevas Louloudakis and Elliniko Dimosio, ECR [2001] Page I-05547, paragraph 55.
[34] Paragraphs 57 and 59 of Louloudakis. See footnote 33.
[35] See paragraph 3.3.1. above.
[36] The Court in Cases C-387/01 Weigel, C-365/02 Marie Lindfors, and judgment of 16 June 2005, case C-138/04 Commission of European Communities v. Kingdom of Denmark, did not endorse the Commission´s position that registration taxes fall under the scope of the exemption of Directive 83/183/EEC, now Directive 2009/55/EC.
[37] For an overview of Member States that exempt from registration taxes where a permanent transfer of a residence occurs, see Section 4.1 of the Communication.
[38] Judgment of 21 March 2002, case C-451/99 Cura Anlagen, paragraph 40.
[39] According to the proposal for Regulation COM(2012)164, a Member State may only require the registration of a vehicle if the holder of the certificate of the leased car has his normal residence on its territory. However, the proposal deals only with the administrative authorisation required for the entry into service of a vehicle on the road traffic, without interfering with the taxing powers of Member States.
[40] Case C-451/99, Cura Anlagen, paragraph 69.
[41] Concerning the VAT treatment of leasing of vehicles, by virtue of the modifications introduced by Directive 2008/8/EC (OJ L 44 of 20.2.2008, p. 11), as from 1 January 2010 the long-term leasing of vehicles is taxable i) in the country where the customer is established in a business-to-business (B2B) relation (new Article 44 of the VAT Directive), ii) in the country where the supplier is established in a business-to-consumer (B2C) relation (new Article 45 of the VAT Directive). The "short-term" leasing (not more than 90 days for vessels or 30 days for any other means of transport) is taxable where the means of transport is put at the disposal of the customer in a B2B and B2C relation (new Article 56 of the VAT Directive). As from 1 January 2013, the long-term hiring of a means of transport to a non-taxable person is subject to VAT where the customer is established. Special rules apply for the long-term hiring of boats to a non-taxable person (new Article 56 of the VAT Directive). Certain detailed aspects on the application of the new rules on hiring of means of transport introduced with Directive 2008/8/EC have been further clarified by Articles 38-40 of Regulation EU 282/2011 of 15 March 2011 (OJ L 77 of 23.3.2011, p. 1).
[42] On how the proposed Regulation COM(2012)164 may impact the obligation to re-register a leased vehicle, see footnote 11. The aforementioned proposal does not alter the taxing rights of Member States.
[43] Order of 27 June 2006, case C-242/05 G.M. van de Coevering v. Hoofd van het District Douane Roermond van de rijksbelastingdienst ECR [2006] Page I-05843; Order of 22 May 2008, case C-42/08 M. Ilhan v. Staatssecretaris van Financiën ECR [2008] Page I-00083; Order of the Court of 29 September 2010, case C-91/10 VAV-Autovermietung GmbH v. Inspecteur van de Belastingdienst/Douane Zuid, kantoor Rosendaal.
[44] The situations envisaged here are different from the situation envisaged in Article 5 of Directive 83/182/EEC on tax exemptions for certain means of transport temporarily imported into one Member State from another. Article 5 of Directive 83/182/EEC provides that the exemption from the tax that comes in the scope of that Directive applies without any time limit (i.e. without the constraint of 6 months in any twelve months) where the vehicle registered in the country of normal residence of the user is used regularly for journeys from the place of residence of the worker to the place of work in another Member State. Hence, Article 5 presupposes that the vehicle has been registered in the Member State where the user resides. The case law analysed in this section, on the contrary, envisages the opposite situation, i.e. where the vehicle is not registered in the country of residence of the user but in the country of residence of the employer. As a consequence, it would be the country of residence of the user that requires the payment of the registration tax under the principle that typically the vehicle is registered and has borne the tax of the State of residence of the user or the owner.
[45] Judgment of 15 September 2005, case C-464/02 Commission of the European Communities v Kingdom of Denmark, ECR [2005] Page I-079279, paragraphs 76-79.
[46] Judgment of 15 December 2005, joined cases C-151/04 and 152/04 Criminal proceedings against Claude Nadin, Nadin-Lux SA (C-151/04) and Jean-Pascal Durré (C-152/04), ECR [2005] Page I-11203, paragraph 55.
[47] See case Nadin, paragraph 53.
[48] Judgment of 26 April 2012, joined cases C-578/10, C-579/10, C-580/10 L.A.C. van Putten, P. Mook, G. Frank.
[49] The Court has found that a loan free of charge for cross-border use falls under the free movement of capital and, in particular, falls under heading XI of Annex I to Directive 88/361, regardless of whether loans are for consideration or free of charge (paragraphs 31 and 32 of the judgment van Putten).
[50] Paragraph 54 of the judgment van Putten.
[51] The observations in this paragraph also apply where the object of the supply does not qualify as a "new" vehicle in the sense of the VAT Directive (paragraph 2.1); see paragraph 2.2.
[52] Articles 78 and 79 of the VAT Directive.
[53] Judgment of 28 July 2011, case C-106/10, Lidl and Companhia v Fazenda Pública, paragraph 33 and case-law cited.
[54] Judgment of 1 June 2006, case C-98/05 De Danske Bilimportører v. Skatteministeriet, ECR [2006] Page I-04945 and Judgment of 22 December 2010, case C-433/09 Commission v. Austria.
[55] Case C-98/05 De Danske Bilimportører v. Skatteministeriet.
[56] Judgment of 20 May 2010, case C-228/09 Commission v Republic of Poland ECR [2010] Page I-00070 and case C-106/10 Lidl and Companhia v Fazenda Pública.
[57] See De Danske Bilimportører v. Skatteministeriet, footnote 54.
[58] Cases C-393/98 Nunes Tadeu; C-290/05 Nádasdi and C-333/05 Németh; C-134/07 Piotr Kawala v Gmina Miasta Jaworzna ECR [2007] Page I-10703; C-313/05 Brzeziński and C-387/01 Weigel.
[59] Judgment of 7 June 2007, case C-154/06 Commission of the European Communities v Hellenic Republic, ECR [2006] Page I-00121.
[60] Approximate amount of taxes: a range of the tax due or the maximum tax.
