Legislative summary – October 2018

In this issue:

  • Electronic cash registers
  • Internship documents
  • VAT
  • NATA Orders


Electronic cash registers

The Guide concerning the registration of information on electronic cash registers, as well as on the issuance of the unique identification number certificate – in the pre-operational register stage, has been updated on the website of the National Agency for Tax Administration.

Amongst others, the following amendments have been brought to the Guide:

  • A new sub-chapter has been inserted, which exemplifies how to access the Virtual Private Space service for submitting the Form C801;
  • Clarifications have been brought on the enrollment of electronic cash registers and on the adapted electronic cash registers.

For more details, you may consult the follow link.

Internship certificate and internship contract; and of the application for requesting the bonus for employment promotion

In the OM 865/12 October there were approved the model and content of internship certificate and internship contract and of the application for requesting the bonus for employment promotion, grated for each intern employed.


Opinion of Advocate General in Case C 449/17 A & G Fahrschul Akademie Gmbh against Finanzamt Wolfenbüttel

The ability to drive a car in a contemporary society is almost as widespread as the ability to read or write – almost anyone has a driving license. Does this justify the exemption for driving courses under the same conditions as teaching and reading?

As per the Opinion of the Advocate General, the driving courses organized to obtain the right to drive vehicles (driving license) in categories B and C1 does not fall within the scope of the notion of school or university education for the purposes of this provision.”

CJEU’s Decision in the case C-528/17 Milan Božičevič Ježovnik

On 25 October 2018, the Court of Justice of the European Union („CJEU”) issued a judgment related to Milan Božičevič Ježovnik (C-528/17) case. The case is relevant, in particular for the intra-Community trade and imports sector dealing with the conditions for granting the VAT exemption in the case of an import of goods followed by a subsequent intra-community supply of goods on the European Union territory.

According to the CJEU’s decision, where the taxable person who imported and supplied the goods has benefitted of a VAT exemption for the import of goods, based on an authorization issued futher to a prior audit performed by the competent customs authorities as per the evidence provided by that taxable person, the latter is not required to subsequently pay the VAT when, on the occasion of a subsequent audit, it is proved that the material conditions of the VAT exemption were not met.

However, if it is objectively established that the importer / supplier knew or should have known that the supplies subsequent to the imports were involved in fraud, which was committed by the purchaser and did not take all reasonable steps in its power to avoid that fraud, the VAT exemption would not apply anymore.

For more details, you may consult the Tax Alert no. 33 of 14 November 2018

CJEU Decision in the case C- 153 /17 Volkswagen Financial Services (UK) Ltd

On 18 October 2018, the Court of Justice of the European Union (“CJEU”) issued its judgment in the case Volkswagen Financial Services (UK) Ltd. This decision is relevant for taxable persons who perform economic activities consisting in the rental / leasing of motor vehicles, where there is in place a hire purchase agreement of motor vehicles.

The decision brings into discussion the conditions for exercising the input VAT deduction related to expenses with goods and services used for both taxable and VAT exempt operations, in relation with contracts for the hire purchase of motor vehicles, as well as the VAT treatment applicable to this type of contracts.

As regards the allocation of the general costs, the CJEU was of the view that such costs have a direct and immediate link with the activities of VWFS as a whole, irrespective of the fact that the costs were included only in the price of the VAT exempt transactions. Consequently, the input VAT related to general costs could be deducted to the extent the costs are attributable to taxable operations.

Thus, in respect of the transactions concerned, the CJEU concluded that a special method for determining the VAT pro rata which does not take into account the value of the vehicles, but only the interest, does not ensure a more precise allocation of overhead costs to exempt / table supplies than the general, turnover-based method.

For more details, you may consult the Tax Alert no. 32 of 13 November 2018

CJEU Decision in Case C 249/17 Ryanair Ltd

On 17 October 2018, the European Court of Justice (ECJ) issued a judgment in the case of Ryanair Ltd (C-249/17). The case is relevant, in particular for the holding sector, and deals with the conditions for entitlement to deduct VAT paid on professional services expenses incurred by a company for the purpose of acquiring the shares of a competing company and its intention to provide the latter with taxable services, after the takeover.

The ECJ largely followed the Opinion of the Advocate General (AG), stating that the professional services were provided to Ryanair Ltd under the condition that, through the proposed acquisition of shares, it intended to carry on an economic activity consisting in the provision of management services taxable to the target company.

Ryanair Ltd therefore enjoys the right to deduct in full VAT on the purchase of professional services carried out on the occasion of the public supply of the other airline.

For more details, you may consult the Tax Alert no. 28 of 24 October 2018.

Commission Implementing Regulation (EU) 2018/1602 of 11 October 2018 amending Annex I to Council Regulation (EEC) Council Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff

Council Regulation (EEC) No 2658/87 established a goods nomenclature in order to comply simultaneously with the requirements of the Common Customs Tariff, Union statistics on foreign trade and other Union policies on the importation or exportation of goods.

In the interest of legislative simplification, it is appropriate to modernize the NC and adapt its structure.

Implementing Regulation (EU) 2018/1602 / 11 October 2018, published in the Official Journal of the European Union no. L 273/31 October 2018

NAFA Orders

Order of the President of the National Agency for Tax Administration no. 2.346 / 24.09.2018

The National Agency for Tax Administration has adopted an Order approving the instructions for online filing of declarations on the stage of purchases and deliveries of excisable products using the EMCS-RO STOCURI application

Order no. 2.346 / 24 September 2018, published in the Official Gazette Part I no. 875 of 17 October 2018


For additional information, please contact:

Alex Milcev, Partner – Head of Tax & Legal

Email: office@ro.ey.com

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