European Commission calls on Germany to align its administrative practice regarding cross-border VAT refunds, with EU law

European Commission calls on Germany  to align its administrative practice regarding cross-border VAT refunds, with EU law

International businesses have been very concerned at the highly restrictive manner which Germany applies to the foreign VAT refund procedures and using this as a basis to deny the legal right to input tax reclaim.

The International VAT Association (IVA), which is the world’s leading independent body on international VAT issues, representing the interests of businesses and advisers involved in VAT or equivalent turnover taxes around the globe, made representations to the European Commission regarding the policy currently applied by Germany. The IVA was concerned at the approach of the German Administration, using formal requirements interpreted in a narrow manner to deny the rights of claimants to input VAT recovery and made representations to the European Commission on behalf of its members. The complaint to the Commission related to cases where the substantive information had been provided with the claims, but the German authorities denied the claims outright, because of technical infringements and if the deadline had passed, effectively denied the claimant the right to provide any additional information that might be requested to support its claim. The IVA was of the view that this administrative practice was in breach of the provisions contained in The Refund Directive.

The Commission agreed with the IVA’s arguments and has decided to send a reasoned opinion to Germany asking it to bring its VAT refund rules into line with EU legislation (VAT Directive Council Directive 2006/112/ECand the Refund Directive Council Directive 2008/9/EC).

The Commission’s press release states – ‘In some cases, Germany currently refuses to refund VAT applied for by taxable persons established in another Member State as it considers that the information provided is insufficient without having requested additional information from the applicant.

This leads to refunds being denied even when applicants fulfil the substantive requirements as laid down in EU law.

 If Germany does not act within the next two months, the Commission may decide to bring the case before the Court of Justice of the EU’.

The decision by the Commission to send a reasoned opinion clearly demonstrates the effectiveness of the IVA in acting on behalf of its members.


For any further information on this matter please contact Alexandra Stoicheva ( and Mike Molony (


International VAT Association, August 2018

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