EU Tax Alert Highlights 2022

EU Member States formally adopt directive implementing Pillar Two

On 12 December 2022, the Council of the EU announced that Member States had reached the required unanimity for the adoption of the Directive implementing Pillar Two at EU level. Following this announcement, on 15 December the Council formally adopted the Directive’s compromise text of 25 November 2022 together with a statement stressing the EU’s commitment to also adopt Pillar 1.

ECOFIN amends the Code of Conduct for Business Taxation

On 8 November 2022, the Economic and Financial Affairs configuration of the Council of the European Union (ECOFIN) approved a Revised Code of Conduct for Business Taxation. This is the first revision of such Code of Conduct since 1997. The revised code of conduct introduces, in particular, the concept of 'tax features of general application' and clarifies the review process in the code of conduct group.

Council adopts Regulation on an emergency intervention to address high energy prices

On 6 October 2022, EU Member States formally adopted the Council Regulation on an emergency intervention to address high energy prices. This legislation introduces a common and interdependent set of measures to reduce electricity demand and to collect and redistribute the energy sector's surplus revenues to households and small and medium-sized enterprises.

CJ rules on Luxembourg State aid case (Fiat Chrysler Finance Europe v Commission - Ireland v Commission, Joined Cases C-885/19 P and C-898/19 P)

On 8 November 2022, the CJ delivered its judgment in the case Fiat Chrysler (Joined Cases C-885/19 P and C-898/19 P). In its judgment, the Court set aside the EU General Court’s judgment of 2019 and annulled the Commission’s decision of 2015.

CJ strikes down publicly accessible UBO-register (Luxembourg Business Registers, Joined Cases C-37/20, C-601/20)

On 22 November 2022, the CJ delivered its judgment on the compatibility of the public access to UBO-information contained in a register with the fundamental right to protection of private life and the right to protection of personal data. The CJ declared the prescribed public accessibility to the UBO-register invalid.

CJ rules on whether DAC6 infringes the right to respect communications between a lawyer and his/her client (Order of Flemish Bars and Belgian Association of Tax Lawyers v Flemish Government, C-694/20)

On 8 December 2022, the CJ delivered its judgment in the case of Order of Flemish Bars and Belgian Association of Tax Lawyers v Flemish Government (C-694/20). The case addresses the question referred by the Belgian Constitutional Court regarding Directive 2018/822 (DAC6) and the right to respect communications between a lawyer and his or her client.

EU Commission publishes long-awaited ‘VAT in the Digital Age’ proposal

On 8 December 2022, the European Commission published a legislative proposal regarding VAT in the digital age (‘ViDA initiative’) as part of its action plan for fair and simple taxation. This package aims to improve VAT efficiency and to minimize VAT fraud. This is done by modernizing VAT reporting obligations and facilitating e-invoicing, extending the scope of the VAT rules for the platform economy and moving towards businesses having one single VAT registration in the EU.

CJ rules on obligation to repay VAT previously recovered when intended VAT taxed activities fail to materialize (UAB Vittamed technologijos, C-293/21)

On 6 October 2022, the CJ ruled that the input VAT deducted based on the intention to perform VAT taxed economic activities, has to be paid back when this intention ceases to exist.

CJ judgment on benefits-in-kind between members of VAT Group (Finanzamt T, C-269/20)

On 1 December 2022, the CJ delivered its judgment in the case Finanzamt T (C-269/20) which deals with the question of whether the services that a subsidiary performed for the public sector activities of a German VAT group are subject to VAT.

CJ judgment on German VAT Grouping Scheme (Norddeutsche Gesellschaft für Diakonie mbH, C-141/20)

On 1 December 2022, the CJ delivered its judgment in the case Norddeutsche Gesellschaft für Diakonie mbH (C-141/20) on the conditions to form a VAT group and the rights and obligations of a VAT group.