Case
The plaintiff operated an online mail order business based in Poland. It supplied private customers in Hungary, among others. Here, the goods were transported from Poland to the customers in Hungary. In the course of the order the plaintiff offered the customers the possibility to conclude a contract with a Polish forwarding agency for the purpose of transporting the goods. The plaintiff itself was not involved in the contract. Alternatively, the customers could collect the goods in Poland or choose a carrier other than the recommended one. The plaintiff was not sure whether the transactions were taxable in Poland or Hungary. She therefore obtained information from the Polish tax authorities. They were of the opinion that the sales were taxable in Poland (8 %; collection case). The Hungarian tax administration took a different view. They applied the mail order regulation and demanded sales tax (27 %). The plaintiff defended itself against this; the competent Hungarian court referred the case to the European Court of Justice (ECJ).
Decision
According to the ECJ, the tax authorities are not obliged to agree in which Member State the transactions are to be taxed. Rather, the tax courts are required to appeal to the ECJ for a preliminary ruling if this results in the threat of double taxation. As long as it is not a purely artificial arrangement, it is not abusive to arrange one's business in such a way as to take advantage of the more favourable tax rate. With regard to the question of how the commissioning of the freight forwarder by the customers is to be assessed, the ECJ proceeds in two steps. The first step is to examine the contractual basis. If there are indications that the contractual basis does not correspond to reality, the second step is to examine whether the transport is not economically attributable to the supplier. This is the case if the role of the supplier predominates in both the commissioning and the organization of the essential phases of the shipment, which is still to be examined by the submitting court.
Consequences
It is of little help to the plaintiff that her action is not considered abusive, since the transport is probably economically attributed to her. The turnover is then taxable in Hungary. Furthermore, it should be noted that with the entry into force of the new regulation for distance sales, presumably as of July 1, 2021, the indirect participation of the mail order company will be sufficient to attribute the transport to it. However, the ruling not only affects the structure of mail order contracts, but also affects chain transactions. The determination of the moved delivery, which is essential for the taxation of series transactions, has so far been dependent on the commissioning of the forwarder. According to the ruling, this will continue to apply, but only to the extent that this also corresponds to the economic circumstances, which does not make the treatment of chain transactions any easier.