The Court of Justice of the European Union in the case C 895/19 on March 18, 2021 announced the judgement concerning delayed reporting of intra-Community acquisition. The court concluded that the Polish provisions of the VAT Act resulting in the need to pay interest due to the delayed reporting is inconsistent with the EU Directive.
The decision concerns the VAT provisions in the case of intra-Community acquisition of goods which were introduced in Poland in 2017. Pursuant to these regulations, if a taxpayer shows intra-Community acquisition only after three months following the month in which tax point for this transaction arouse, he should settle the VAT due in the VAT report for the period in which the tax obligation took place, and the input VAT should only be shown in the current VAT report. This situation resulted in obligation to pay interest as the VAT due is shown earlier than the input VAT.
CJEU ruled that the VAT provisions may result in the fact that regardless of the circumstances of a given case, good faith and the reasons for the delay in reporting this regulation limits, due to the breach of the formal condition itself, the exercise of the right to deduct the VAT due on the intra-Community acquisition of goods. Consequently it temporarily places the burden of VAT on the taxpayers – they are forced to pay interest.
The issue of compliance of Polish VAT regulations with EU law has been the subject of a dispute for several years. There have been many proceedings between the tax authorities and taxpayers. But even the courts in Poland have not developed a uniform position. Now, following the judgement, the taxpayers should consider possible corrections or resume proceedings in which unfavorable decisions were issued for them.
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