THE ABUSE OF LAW CLAUSE WITH RESPECT TO VAT

Abstrakt

This article presents a problem of the abuse of law clause with respect to VAT that gives rise to numerous disputes between tax authorities and taxpayers. It aims at comprehensively discussing this problem, in the context of the source literature as well as national and EU legislation and case law. The issue presented in this article is important for the operations of enterprises. A principal conclusion is that in each case, tax authorities and administrative courts must examine the transaction and all its aspects in their entirety in terms of their actual nature and objective. This boils down to investigating whether the only objective of a given transaction is to obtain an undue tax advantage, or whether such an advantage is merely gained by an entity “along the way”.