ECJ Case: Removal from VAT register must consider taxpayer conduct
The European Court of Justice (ECJ) issued a preliminary ruling in Case C-164/24 concerning the removal of a Bulgarian construction company from the VAT register due to persistent noncompliance. The case focused on whether Bulgarian tax law, which permits deregistration for failing to pay declared VAT over a five-year period, aligns with EU VAT legislation.
The ECJ concluded that:
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Articles 213 and 273 of Council Directive 2006/112/EC, along with the principles of legal certainty and proportionality, do not permit national laws that allow removal from the VAT register solely for noncompliance, without assessing the specific nature of the violations and the behavior of the taxable person.
The ruling clarifies that national authorities must evaluate each case individually, considering whether the taxpayer’s conduct justifies such a measure, rather than applying automatic deregistration policies.
Source: europa.eu
