Out-Law News | 29 Sep 2014 | 5:14 pm | 1 min. read
Under German VAT legislation, taxable persons established outside the EU must personally sign the application form to be refunded the VAT charged on goods or services. However, operators established in Germany or in the EU can authorise a third person to sign or submit their refund form to recover VAT, the EC said.
The EC said it considered the German requirement for third country operators “goes against the principles of effectiveness, proportionality and equivalence laid down in EU law”.
The EC said it was referring the issue to the CJEU because German authorities had not amended national law to comply with EU law. The Commission previously called for such an amendment to be made in September 2012 when it issued a ‘reasoned opinion’ on the matter - the second stage of an infringement procedure.
According to the EC, “there is no provision under EU legislation which requires VAT refund forms to be personally signed... moreover, requiring a personal signature from non-EU operators, but not EU ones, can make it excessively difficult for those not established in the EU to obtain a VAT refund”.
The EC said Germany’s stated aim of using the requirement to combat tax evasion and ensure “a proper refund procedure, could be achieved through other means, such as the appointment of a tax representative”.
According to the EC, “in around 95% of infringement cases EU member states comply” with their obligations under EU law before they are referred to the CJEU. Member states must comply with any CJEU ruling.