ECJ case: Ruling on joint and several liability in Poland
The European Court of Justice (ECJ) issued a preliminary ruling on February 27 in Case No. C-277/24, concerning Polish rules on joint and several liability for VAT debts. The case involved a former company board chairperson held jointly and severally liable for the company’s VAT debt.
Key findings of the ECJ ruling
- The Polish Tax Administration determined that the taxpayer had no legal interest in applying for party status in the administrative proceedings against the company.
- The taxpayer filed an action in Polish court, seeking to annul this determination.
- Upon referral, the ECJ ruled that:
- Article 273 of the VAT Directive, read with Article 325(1) of the Treaty on the Functioning of the European Union (TFEU), does not prevent national legislation from excluding third parties from proceedings establishing a legal entity’s tax debt.
- However, this exclusion is subject to the third party’s right to challenge tax authorities’ findings in separate joint and several liability proceedings.
- The third party must also have access to the tax authority’s file when contesting the decision.
The ruling clarifies the procedural rights of individuals held jointly and severally liable for VAT debts under Polish law.
Source: europa.eu
