Responsibility of the court enforcement officer in enforcement proceedings
Judgment of the European Court of Justice of 26 March 2015 in Case C-499/13.
The case concerns a method of enforcement by public auction conducted by the Polish government.
According to Article 18 of the Polish VAT Law, court enforcement officers carrying out enforcement action within the meaning of the Code of Civil Procedure shall be paying agents for tax collected on the supply, effected through enforcement, of goods which are owned by the debtor or in his possession in breach of existing law.’
In this sense, the Polish tax authorities determined the responsibility of Mr Macikowski, as court enforcement officer responsible for the enforcement of a property, to pay the tax he had received from the sale of the property, but had not paid within the deadline.
Mr. Macikowski appealed this decision to the Tax Administration before the relevant jurisdiction in Poland, which referred to the ECJ the following questions for a preliminary ruling:
1) In the light of the system of VAT resulting from the VAT Directive, in particular Articles 9 and 193, in conjunction with Article 199(1)(g), is a provision of national law permissible, such as that in Article 18 of the VAT Law, which introduces exceptions to the general rules on that tax, in particular with regard to the persons required to calculate and collect the tax, by establishing the concept of paying agent, that is to say, a person who is required, on behalf of the taxable person, to calculate the amount of tax, collect it from the taxable person, and pay it to the tax authority in good time?
2) If the answer to the first question is in the affirmative:
a) In the light of the principle of proportionality, which is a general principle of EU law, is a provision of national law permissible, such as that in Article 18 of the VAT Law, under which, inter alia, tax on the supply of immovable property effected through enforcement in respect of goods owned by the debtor or in his possession in breach of existing law is calculated, collected and paid by a court enforcement officer carrying out an enforcement action
b) In the light of Articles 206, 250 and 252 of the VAT Directive and of the principle of neutrality arising therefrom, is a provision of national law permissible, such as that in Article 18 of the VAT Law, under which a paying agent as referred to in that provision is required to calculate, collect and pay, within the tax period of the taxable person, an amount of VAT on a supply, effected through enforcement, of goods owned by that taxable person or in his possession in breach of the law in force, in an amount comprising the product of the proceeds from the sale of the goods, minus VAT, and the applicable rate of that tax, with no reduction of that amount by the amount of input tax from the beginning of the tax period to the date of the collection of that tax from the taxable person?’
Regarding the first question, solves the ECJ saying that those articles of Directive 2006/112 / EC must be interpreted as not precluding a national provision such as that at issue in the main proceedings, which, in the context of the sale of a property by enforcement, imposes an operator, namely, the court enforcement officer who performed the aforementioned sale, liquidate obligations, collect and input value added tax payable on the product of that operation within the deadline.
Regarding question 2.a), the ECJ states that the principle of proportionality must be interpreted as not precluding a provision of national law such as that at issue in the main proceedings, whereby a court enforcement officer has to respond with all its assets in the share of value added tax payable on the sale of a property held by enforcement if they do not fulfil their obligation to collect and enter the tax, provided that the court enforcement officer in question actually has all the legal means to fulfil this obligation, which it is for the national court.
Finally, regarding the question 2.b), the ECJ states that the aforementioned articles of Directive 2006/112 / EC and the principle of fiscal neutrality must be interpreted as not precluding a provision of national law, such as that at issue in the main proceedings, under which the paying agent as referred to in that provision is required to calculate, collect and pay an amount of value added tax on a sale of goods effected through enforcement without being able to deduct the amount of value added tax paid as input tax from the beginning of the tax period to the date of the collection of that tax from the taxable person.
At this point, it is clear that the court enforcement officer is not allowed to deduct VAT on the transaction because it is the taxpayer, owner of the goods sold at public auction by the court enforcement officer, who have the right to deduct VAT.
For further information please contact us at info@diligens.es
