The Commission has requested Poland to amend its VAT laws and its treatment of foreign pension funds, investment funds and financial institutions; Latvia to amend its VAT laws and Austria to amended its rules relating to the appointment of fiscal representatives.

Poland

VAT

The Commission has referred Poland to the ECJ on the application of VAT to certain cross-border passenger transport services.

According to the VAT Directive, cross-frontier transport services are subject to VAT in each Member State for the distance travelled therein. Poland has introduced a particular VAT scheme for cross-border passenger transport services supplied on an occasional basis by means of buses registered abroad. The scheme leads to VAT due in Poland being collected through payment at the border of an amount calculated on the basis of an average taxable amount per traveller. This scheme deviates from the Community rules.

Foreign pension funds, investment funds and financial institutions

The Commission has sent a reasoned opinion to Poland with regard to its legislation which provides for higher taxation of interest and dividends paid to foreign pension funds and investment funds and higher taxation of interest paid to foreign financial institutions.

Latvia

The Commission has formally requested the Republic of Latvia to stop exempting from VAT transactions involving land for construction. EU VAT rules expressly provide for VAT on supplies of land for construction. The request is communicated in the form of a ‘reasoned opinion’.

Austria

The Commission has formally requested Austria to change its tax provisions relating to the appointment of a fiscal representative. The Commission considers that the rules which request foreign investment funds, real estate funds and credit institutions to appoint a fiscal representative result in discriminatory treatment. The request takes the form of a reasoned opinion.