EC refers Poland, 7 other countries to court over VAT rules for travel agents.

By bne IntelliNews January 28, 2011
The European Commission has decided to refer Poland - alongside the Czech Republic, Finland, France, Greece, Italy, Portugal and Spain - to the EU's Court of Justice for failing to properly implement EU VAT rules for travel agents, the EC's press service has announced. The VAT Directive 2006/112/EC contains special provisions (the so-called special margin scheme) for travel agents when they sell travel packages to travellers. However, the member states being referred to Court on this matter have implemented these special provisions incorrectly, leading to distortions in competition between travel agents, the Commission argues. These eight countries are not implementing the special margin scheme correctly, often by allowing it to apply to sales between travel agents. This creates distortions of competition between travel agencies, as it leads to some agents carrying a heavier tax burden than others, it added. tom

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