Global

Details

  • Service: Tax, Global Indirect Tax
  • Type: Business and industry issue
  • Date: 6/24/2013

Sweden – Possible to exempt intra-Community supplies even if the purchaser's VAT number cannot be presented 

GITB June 2013 - Sweden
The Swedish Tax Agency (STA) has previously required that the supplier can present the VAT number of the purchaser to exempt intra-Community supplies of goods.

The goods must also be transported to another member state in order for the exemption to apply. However, the STA, following the CJEU judgment in case C-587/10 (VSTR), has now stated that the exemption may apply even if the supplier, when acting in good faith and when it has taken every measure which can reasonably be required of it to ensure that the purchaser is a taxable person, cannot present the purchaser’s VAT number. This is the case if the supplier has other sufficient information to support the fact that the purchaser is a taxable person.


Hence, in order for the exemption to apply, the supplier must be able to prove that the following conditions are met for the supply; the purchaser shall be a taxable person, acting as such, in another member state. The purchaser shall either make supplies in another member state which to some part entails recovery of input VAT or has made acquisitions during the previous or current year which resulted in an obligation to account for VAT on the acquisition or alternatively has opted to tax the acquisition. Also, the purchaser must provide an acceptable explanation of why a VAT number could not be presented, notwithstanding that one should exist.


Under the new approach from the STA, it will for example be possible to apply the exemption where the purchasers VAT registration is pending. This will make it easier for both the supplier and the purchaser. Still, the VAT number of the purchaser will be the best and easiest proof of the purchaser’s status as a taxable person.

Inquiry proposes new regulations regarding import VAT

Swedish Customs is currently the competent tax authority in Sweden for VAT on imports. This means that importers report and pay output VAT on imports to the Swedish Customs and the STA is the competent authority for deduction/refund of VAT. About 97 percent of the VAT paid to Swedish Customs is paid by VAT registered importers, who are entitled to deduct almost all VAT. Since the deduction is made after tax payment date, importers suffer a negative liquidate effect in the current system.


A national inquiry proposes that an importer that is VAT registered in Sweden should report and pay the import VAT to the STA instead of Swedish Customs. Furthermore, an importer who is entitled to a full deduction of the VAT does not have to make a payment, since the output and input VAT regarding an importation are reported in the same accounting period and cancel each other out.


Importers who are not VAT registered in Sweden will continue to report and pay import VAT to Swedish Customs.


It is proposed that the new regulations enter into force on 1 September 2014.

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Global Indirect Tax Brief: June 2013

GITB: June 2013
Articles in this edition highlight the increasing importance of indirect tax as one of the most important sources of revenue for governments around the world.

More Global Indirect Tax Briefs