The decision of the European Court of Justice regarding the VAT treatment of electric vehicle charging transactions is awaited.
October 2024
The case involves a dispute between the Swedish Tax Agency (Skatteverket) and the German company Digital Charging Solutions GmbH (DCS) over the VAT treatment of electricity transmission through charging points.
DCS provides electric vehicle users in Sweden with access to a network of charging points, offering real-time information on prices, locations, and availability. The charging points within this network are not operated by DCS, but by third-party charging point operators with whom DCS has contracts. Based on invoices received from these operators, DCS issues invoices to card or application users for the electricity supplied, as well as for access to the network and ancillary services.
In the opinion issued for this case (C-60/23), Advocate General Ćapeta analyzed three potential VAT treatments based on the general principle that the main criterion for determining VAT treatment should be the actual economic and commercial substance of the transactions, emphasized by the European Court in previous cases.
The Advocate General has proposed the commissionaire model (Article 14(2)(c) of the VAT Directive and § 2(5) of Estonian VAT Act) as the best option for the present case because it better aligns with the contractual arrangements and the role of the parties involved.
The decision of the European Court of Justice could have significant implications for both charging point operators and card/application providers who bill consumers for electricity usage.
The Advocate General's opinion is part of a broader discussion on how to adapt the VAT system to accommodate new technologies and business models. The European Court of Justice is expected to issue its ruling on case C-60/23 on October 17. It remains to be seen whether the Court of Justice of the European Union (CJEU) will follow the opinion of Advocate General Ćapeta.
Authors: Kätlin Klaos, Tatjana Kriisa
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