BackThe Supreme Court, in its judgment No. 236/2023, upheld that the deduction of input VAT is a taxpayer’s right, and not a tax option under Article 119.3 of the General Tax Act (LGT). The Chamber considers that the essential elements for defining the tax options do not come together, since this does not imply that the tax rule grants an alternative of choice between different and exclusive tax systems.
What does the sentence notify?
The judgment holds that “when a taxpayer decides to deduct a VAT contribution, he is not exercising any option, but a right. This means, in relation to the circumstances of the case under consideration, that the presentation of the additional self-assessments modifying the initial deduction of input VAT quotas cannot be classified as a tax option, but as an exercise of the right to deduct input VAT“.
In the present case, the Supreme Court ruled that the non-deductibility of VAT quotas was imposed by the administrative criterion. Had the supplementary self-assessments not been submitted, the taxpayer would have been exposed to more negative consequences for his interests. Thus, the Chamber states that “the way in which the taxpayer was able to show his disagreement with the Administration’s judgment without incurring tax defaults, was the rectification of its additional self-assessments following the procedure provided for in articles 120.3 and 221.4 LGT“.
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