Cristina Trenta
VAT and Communication Services
in the European Tax System and in the Italian and Swedish Experience
European Commission, January 21st 2009

Cristina Trenta – VAT and Communication Services
About this Talk
This talk examines European regulations in
the field of VAT for communication services
as modified by Directives 1999/59/EC and
2002/38/EC, currently contained in
Directive 2006/112/EC as implemented
within the national system in both Sweden
and Italy

Cristina Trenta – VAT and Communication Services
Goals
identification and classification of

communication services
territoriality in the field of communication

services
applicable VAT rates and the impact of

these rates on national tax systems

Cristina Trenta – VAT and Communication Services
Framework
Sixth Council Directive 77/388/EEC

Council Directive 1999/59/EC

Council Directive 2002/38/EC

Council Directive 2006/112/EC

Council Directive 2008/8/EC


Cristina Trenta – VAT and Communication Services
Main Issues
Lack of harmonization connected with the

national implementation of Directives
1999/59/EC and 2002/38/EC
The new course of Directive 2008/8/EC

seems to perpetuate current defects

Cristina Trenta – VAT and Communication Services
Lack of Harmonization
Double taxation and non-taxation issues
may rise in transactions between Member
states
These might depend on:
Generic ambiguities in the text of the

Directives
Implementation errors at the national

level

Cristina Trenta – VAT and Communication Services
Perpetuation of Current Defects
Simplifications following the application of
the new art. 58 are not enough
The scope of the option on effective use and
enjoyment will become broader because of
art. 59a
Member states are allowed more freedom in
the implementation of this rule

Cristina Trenta – VAT and Communication Services
Classifying Supplies
Supplies of goods are the transfer of the
right to dispose of tangible property as the
owner [art. 14 (1) RVD ex Art. 5 (1) Sixth
Directive]
Supplies of services are those transactions
which do not constitute a supply of goods
[art. 24 (1) RVD ex Art. 6 (1) Sixth
Directive]

Cristina Trenta – VAT and Communication Services
(SE) Changes in National Tax Law
Sweden (SE)
Act (2003:220)
Implemented Directive 2002/38/EC
Changes to the VAT Act (ML) were required, especially in
respect to the rules on the territoriality of radio-television and
electronic services (Ch. 5, 7§ ML)
New indents were added as par. 11, concerning services of
radio and television broadcasting, and par. 12, concerning
electronic services
These were classified as supplies of services

Cristina Trenta – VAT and Communication Services
(IT) Changes in National Tax Law
Italy (IT)
Legislative Decree (DLgs) 273/2003
Implemented such services within the frame of Presidential
Decree (DPR) 633/72, art. 7, par. 4 as new letters d), f), f-
ter) and f-quater)
Effectively classified them as supplies of services

Cristina Trenta – VAT and Communication Services
(IT) Issues in VAT Law
The definition of supply of goods
Is so broad it may be considered to cover any type of goods
Drops the distinction made at the EU level between on-line and
off-line operation
Is in partial contradiction with Community provisions, as it
defines supplies of goods “acts upon consideration that
involve the transfer of property or the creation or transfer of
rights of use or enjoyment for goods of any kind” (art. 2)

Cristina Trenta – V