Taxable Person Research Articles

Issues of Tax Integration in the Practice of the Court of the Eurasian Economic Union: Commentary on the Advisory Opinion on the Case CE-2-1/1-22-БК2

Introduction. Economic and political processes in integration associations are accompanied by the convergence of the legal systems of their Member States. The area of harmonization, which is both important from the point of view of the formation of the internal market (indirect taxes) and sensitive from the point of view of sovereignty (direct taxes), is the sphere of taxation. Despite the long-term work on the harmonization of legislation on taxes and fees within the framework of the EAEU, there are still many issues that need both interstate and national settlement. Methods. The methodological basis of the research was made up of general scientific methods of cognition: analysis, synthesis, abstraction, induction, deduction, analogy, modeling, systemic, as well as private scientific methods – the formal legal method and comparative legal method. Results. The authors refer to the practice of the EAEU Court as a supranational judicial body with the authority to resolve disputes on the application of the sources of the EAEU law, as well as to clarify their provisions. Cross-border tax issues may become the subject of research by the EAEU Court, including in the procedure for the implementation of advisory competence. The acts of the EAEU Court allow not only to resolve the dispute, but also to eliminate possible conflicts in law, as well as the inconsistency of its understanding. The growing role of Court acts is noted precisely as acts of interpretation, which is shown by the examples of advisory opinions on tax disputes. The article examines the basic principles of collecting indirect taxes on the export and import of goods and services on the example of the advisory opinion on the case CE-2-1/1-22-БК, as well as comparisons with earlier cases considered by the EAEU Court, in which tax issues were raised. The connection of the considered problems with the concept of tax sovereignty is noted. Defining the boundaries of the circle of taxable persons is related to the tasks of national policy, including such as combating tax evasion and protecting the national fiscal base. Discussion and Сonclusion. In the course of the study, the authors come to the conclusion that the EAEU Court does not have the authority to determine the order of execution of the decision, as well as to apply interim measures, at the same time, the countries themselves participating in the integration association impose on law enforcers the obligation to adhere to the principles of maintaining confidence in the Treaty on the EAEU.

The volitional aspect in the emergence of taxpayers’material subjectivity – basic reflections

The article considers the significance of volitivity in the setting up of tax subjectivity (personality) in terms offactual (resp. substantial) taxpayer – the one upon whom the tax obligation rests. The author specifies four methodsof identifying the tax personality – incl. objectivistic, behavioral, equitable, and subjective – in order to outlinethe field of analysis. In case that the object of taxation includes factual and, in particular, economic events orconditions, the will of the subject participating therein as a taxpayer/taxable person (or otherwise) may be, andindeed proves to be, of essential significance. The author argues that the subject who is willing to become a taxpayer/taxable person becomes such a subject even when acting under an error-of-law (phantom taxpayer) or whenacting in bad faith if participating in an event (condition) that objectively is not subject to taxation and yet (s)he/it has submitted the related tax return – unless such subject has quit or lost this status under jurisdiction proceedings.In case that a subject has unconsciously participated as a taxpayer in a third-party tax fraud, whilst (s)he/itshould otherwise have been aware of it, (s)he/it may not be a taxpayer/taxable person anymore, which howevermay only be established through jurisdiction proceedings. To conclude, if a subject is willing to be a factual (substantial)taxpayer, (s)he/it becomes a taxpayer (taxable person) even if (s)he/it has submitted a tax return thatspecifies, in particular, the tax obligation related to events (conditions) not subject to taxation

VAT and Directors’ Fees: Can Directors Who Are Individuals Be Considered Taxable Persons?

In the aftermath of the ECJ’s decision in the TP (C-288/22) case, the author of this article argues that directors who are private persons can be taxable persons for VAT purposes. The author argues that this idea is a solution in line with the broadness inherent in the concept of taxable person and that directors can fulfil the requirements of “any person”, “economic activity” and of acting “independently”. In addition, the author stresses that depriving an individual of such a status may equate to hindering legal neutrality (or at least the principle of equal treatment), as well as affecting system neutrality. Furthermore, this article reveals the alignment of this position with economic reality. Lastly, it will signal some of the undesirable consequences of negating the taxable person status: from non-taxation and creation of opportunities for tax avoidance, to tax non-neutrality.

Present and Future Challenges of the Special VAT Scheme for Travel Agents

The special scheme for travel agents and tour operators was designed as a simplification measure to avoid multiple registration obligations for businesses in this sector and to allocate VAT revenues to the Member State of consumption. However, the scheme raises a number of practical difficulties, largely due to the different interpretations of the scheme in the Member States, which makes it difficult for taxable persons to manage. In this article, the author discusses some of these practical difficulties and points out what he believes may be possible future solutions.

Implementation of Environmentally Friendly Investments by Municipalities and VAT Status

The article deals with the judgment of the CJEU in case C-612/21 which answered an important question. Namely, under what circumstances can a public body be considered a taxable person for VAT. This case concerns a Polish municipality which organized the installation of renewable energy systems (RES) on its territory for its residents who own immovable property and who expressed a desire to be equipped with RES. The municipality was reimbursed with a subsidy of 75% of the subsidisable costs from the competent provincial authority. The CJEU ruled that in this specific case, the public body would not be carrying out economic activity and, therefore, should not be considered a taxable person for VAT.

Article: The Double Layer Test versus the VAT Neutrality Principle

With the Morgan Stanley judgment, the Court of Justice of the European Union (CJEU) established what is known as the double requirement (or double layer test) in order to exercise the right to deduct VAT in cases of cross-border transactions carried out by taxable persons. In this work, the author examines this test and its possible incompatibilities with a number of fundamental VAT principles through different cross-border transaction scenarios. The analysis elucidates problems that may arise, and proposals are advanced to address them. These solutions involve eliminating the double requirement or, alternatively, implementing an intra-Community transfer for services regime that is equivalent to that which already exists for goods. VAT, double layer test, intra-EU transfer of services, cross-border transactions, equal treatment principle, VAT deon, VAT refund, VAT neutrality principle

A Strict Test for Economic Reality: The Concept of VAT Supply in Airtours

In this article, the author discusses the UK Supreme Court decision in the Airtours case and the two-step test done by Judge Lord Neuberger focusing on identifying a contractual obligation to make a supply to the payor and only departing from this requirement if it would be in accordance with “economic reality”. The author submits that contract law can serve as a starting point, but that the focus on the existence of a contractual obligation in Airtours makes the test excessively restrictive. In the author’s view, “economic reality” in a multiple-party situation should not require the taxable person to prove “artificiality” or “sham”; and contract law and the contractual terms should not serve as a “strait-jacket” for VAT law.

PENGARUH DIMENSI ZAKAT, MONEY ETHICS, DAN SOSIALISASI PAJAK TERHADAP KEPATUHAN WAJIB PAJAK PADA UMKM DI SURABAYA

The objective of this study is to examine the influence of the zakat dimension, money ethics, and tax socialization on the level of compliance with compulsory personal tax among small and medium-sized enterprises in the Surabaya region. Basic research, which aims to improve and enhance current theories while also expanding knowledge, This study incorporates three distinct research variables, including tax socialization, money ethics, and the zakat component. The study employed a sample size of 100 respondents, who were selected from the population of taxable persons and individual perpetrators of the UMKM Islamic religion in Surabaya. The distribution of the sample was conducted using a questionnaire, which was administered to individuals registered with the KPP Pratama Surabaya. The present study used a multiple linear regression analysis for data analysis. The findings of the study indicate a significant positive correlation between taxation dimensions and tax socialization and compliance with tax duties. Conversely, the variable of money ethics exhibits a significant negative association with tax compliance.

VAT and the Concept of Fixed Establishment: The Cabot Plastics Belgium Case

In this article, the authors analyse an important ECJ decision in the Cabot case concerning the interpretation of the concept of fixed establishment for VAT purposes, and explain the practical consequences that this case has for taxable persons carrying out cross-border activities.

Digitalization of VAT Reporting in Poland

The process of digitalization of VAT reporting has been progressing for years in many jurisdictions, including Poland. It started with allowing taxable persons to file their returns electronically as well as to issue invoices in a paperless form. Recently, huge advances in the process have been made in Poland, as a new act requiring taxable persons to issue invoices via a cloud operated for the tax authorities (the National E-Invoicing System) has been enacted. It will be obligatory, for most taxable persons, to use this system from 1 July 2024. In this article, the author presents the new invoicing rules and analyses them from a business perspective. The system is compared with the developments envisaged under the EU ViDA proposal.

Case Law Trends: Adjustment of Deductions in case of the Abandonment of an Investment Project: Some Remarks in Light of the Judgments of the CJEU in ITH Comercial Timisoara (C-734/19), Skellefteå Industrihus (Case C-248/20) and Vittamed Technologijos (C-293/21)

Articles 184 and 185 of the VAT Directive provide for the general obligation to adjust an initial deduction if it is higher or lower than that to which the taxable person was entitled. Does the abandonment of an investment project always imply the obligation to adjust deductions in respect of the acquired goods and/or services that cannot be used in the taxed activity of the taxable person? What if the termination of an investment project is followed by the liquidation of the taxable person? These questions are addressed by the CJEU in the judgments presented in this case note. The right to deduct, adjustment of deductions, unimplemented investment projects, cessation of economic activity.

Excellent Customer Services and Tax Revenue Generation: A Theoretical and Conceptual Review

Revenue generation from taxpayers is one prime and important component of government fiscal acquisitions. Taxation is the process of levying and collection of tax from taxable persons and organizations or establishments. The objectives of government using taxation include revenue generation to help the government to finance increasing public sector expenditure and to promote social, economic and good governance through provision of merit goods. Merit goods include health and education that must not be left solely to private hands, though private participation should also be encouraged. Revenue generated from tax can also be used to provide commonly consumed goods and services for which individuals cannot be levied. Public goods include internal security through maintenance of law and order by police and other security agencies, external security through defense against external aggression by Navy, Army and Air Forces, and provision of basic amenities such as pipe borne water, street lights and roads. We reviewed tax customer services provided by internal revenue agencies and explore options that are available for excellent customer services to be provided in this parlance. We conclude by identifying gaps in the research domain as a way of setting the stage for further research on the subject matter Keywords: Revenue, Government, Tax, Taxation, Public Good, Fiscal, Finance, Security, Customers Journal Reference Format: Obadeyi Juliana Adepeju & Adeyemo, Felicia (2023): Excellent Customer Services and Tax Revenue Generation - Theoretical and Conceptual Review. Social Informatics, Business, Politics, L:aw, Environmental Sciences & Technology Journal. Vol. 9, No. 3. Pp 9-20 www.isteams/socialinformaticsjournal. dx.doi.org/10.22624/AIMS/SIJ/V9N3P2.

ECJ Decisions in the Skellefteå Industrihus AB and Vittamed Cases: A Severe Blow to the Neutrality of the VAT System

In this Column, the author analyses the ECJ’s decisions in the Skellefteå Industrihus AB and Vittamed cases, which concerned the issue whether or not a taxable person should adjust the VAT deductions made in connection with a project that was abandoned.

Article: New Tendencies Regarding the Relevance of Formal Requirements in VAT Law

Back in 1858, Rudolf von Jhering, a well-known German legal scholar, said: ‘Form is the sworn enemy of arbitrariness, the twin sister of freedom’. Perhaps this is why Value Added Tax (VAT) law includes many formal requirements before the taxpayer can exercise his right of deduction or can opt for taxation, for example. Concerning these formal requirements, it is not disputed that the Court of Justice of the European Union (CJEU or Court of Justice) has put a stop to excessive formalism in VAT law. However, there are some interesting recent decisions of the Court of Justice, which were dealing with the question as to whether the lack of formal requirements allows the financial administration to deny the right of deduction or the right to opt for taxation, even if the material conditions are fulfilled. This article shows that there is a recent tendency in the jurisprudence of the CJEU to take more into account the function of formal conditions in the field of VAT law. It seems that the Court has found now a better balance between the rights of the taxable person and the principle of proportionality, on the one hand, and the principle of neutrality and the uniform and simple application of VAT law, on the other. VAT law, formal requirements, VAT identification number, Invoice, Registration as taxable person, formal and material conditions, sens of form, no right to deduction without an invoice, necessary content of an invoice

Challenges related to determining for VAT purposes the status of the goods and services provider using the platform economy

Background: The aim of the study was to analyse EU legislation and case law on the VAT status of the provider of goods and services for the platform economy. This issue is becoming increasingly important in the context of a rapidly developing platform economy, using the latest technological developments. The study conducted a comprehensive legal analysis of the issue, at the same time drawing attention to the doubts that exist particularly due to the lack of CJEU judgments on the concept of a taxable person in the platform economy.
 Research purpose: The aim of the study was not only to assess the relevant legislation or its interpretation, but above all to draw attention to the need to fill the legislative gap in the area studied, which has led, and may continue to lead, to non-uniform application of VAT rules in the EU Member States.
 Methods: The study was carried out predominantly using the empirical-dogmatic method, backed by a historical method and comparative method.
 Conclusions: Our analysis demonstrated that the provisions of the VAT Directive do not simply and clearly regulate whether a platform provider is a taxable person. There is also a lack of CJEU jurisprudence addressing this issue; judgments on the ‘traditional’ economy do not seem to ‘fit’ the specifics of the platform economy. In our opinion, legislative changes are needed, especially the VAT Directive, which would take into account the specifics of transactions in the platform economy. We present preliminary proposals that can be taken into account in the legislative work on the European Commission’s recently proposed provisions in this area.

Collective management of copyright and related rights - fiscal implications

Creative activities are a constant in all the periods and changes that humanity has gone through, they enriched life, improved living conditions and contributed to the progress made in different areas of activity. In today’s highly digitized context, social networks, YouTube, Spotify and Netflix are representative means by which intellectual creations reach the public. In this equation, it is legally required to answer the question how do creators, authors and holders of related rights receive appropriate compensation for the use and exploitation of their works? Collective management organizations provide an answer, they provide a way through which copyright and related rights may be exercised. As a consequence of their contribution to the exploitation of copyright and related rights, collective management organizations also play a fiscal role. Some aspects require clarifications, such as identification of taxable persons, direct and indirect tax applied to the achieved income, as well as non-patrimonial tax obligations.

Personal Income Tax in Nigerian Fiscal Federalism: Matters Arising

Fiscal federalism is a by-product of federalism. Federalism is a political concept in which power to govern is shared between national and sub-national Governments creating what is often called a federation. Federalism is a political concept in which the power to govern is shared between Federal, States and Local Governments, creating what is often called a federation. Fiscal federalism is characterized by fiscal relations between central and lower levels of Government. The progression in taxation in Nigeria is from personal income tax to taxation on other sources such as petroleum, companies etc. Personal Income Tax Act identifies taxable persons, chargeable incomes, determines assessable income and tax that income. The Act also determines the residence of the tax payer for the purpose of payment and or collection of personal income tax. This paper contains primary and secondary sourced materials, such as laws, statutes, and other resource materials. This paper revealed the aspect of personal income that raises concerns on the ownership of funds collected by State Governments through the State Boards of Internal Revenue under personal income tax regime. Though it is argued by some school of thought that the rules of agency suggest that an agent acting under a delegated authority cannot be heard contesting the subject matter of agency with the principal. However, due to the combined provisions of sections 80(1), 120(1) and 163 of the Constitution which direct that the personal income tax collected by the State Government be paid into the Consolidated Revenue Fund of the State and used for the benefit of the State lay to rest the issue of ownership of the personal income tax collected by the State Government.

Proposal for a Secure Digital Reporting Standard for Intra-Community Transactions

While the EU VAT world is holding its breath and waits for the European Commission to publish a proposal to streamline digital reporting requirements in the European Union, in this article the authors make a proposal for a secure digital reporting standard that takes into account the legitimate interests of Member States and taxable persons alike, and is compatible with the fundamental rights and principles enshrined in EU law.

Adjustment of Deductions in Case of Capital Goods – Revocation of the VAT Number

The ECJ judgment in S.H. v. Administraţia Judeţeană a Finanţelor Publice Sibiu and Direcţia Generală Regională a Finanţelor Publice Braşov addresses the Romanian legislation and the corresponding practice of the tax authorities under which taxable persons with a revoked VAT number, based on national provisions enacted to counter abusive practices, are denied the right to deduct the VAT related to capital goods. In this article, the author explains that the denial of the deduction right is final and is made through a proportional negative adjustment, based on an irrefragable presumption that the capital goods are not used for the purpose of economic activities.

Adjustment of Value-Added Tax

The article highlights the accounting and fiscal regime regarding the adjustment of the value-added tax in the case of capital goods and the purchases of goods and services, other than capital goods. The legal basis regarding VAT adjustment is represented by the provisions of the Fiscal Code and its enforcement rules. The tax adjustment constitutes the exercise of the deduction right in case the taxable person earns the right of deduction in compliance with the legal provisions in force (positive adjustment) or the total or partial cancellation of the initially exercised deduction in case the taxable person loses the right of deduction pursuant to the law (negative adjustment).