VwGH: Interest on late repayment of VAT claim
The Administrative Court (Verwaltungsgerichtshof, VwGH) ruled on the possibility of claiming interest on late repayment of an input tax surplus.
The appellant was a hotelier who claimed a surplus of input tax in 2007 as part of the advance VAT return submitted in 2007. However, the tax office only recognised a small part of it. It was not until 2013 that the appellant's appeal against this was upheld and the entire amount claimed was determined as such.
Consequently, the appellant requested interest on this VAT claim on the grounds that, according to Union law, financial losses due to late reimbursement of the VAT surplus must be compensated by interest. The VwGH referred the question of whether European Union (EU) law contains such a directly applicable rule to the European Court of Justice (ECJ) for a preliminary ruling.
In its decision, the ECJ stated that such an obligation to pay interest does not arise from directly applicable EU law, but that in general financial losses arising from late reimbursement of the VAT surplus must be compensated by interest payments. The VwGH should fulfil this obligation by interpreting national law in conformity with EU law.
In this respect, the VwGH first stated that Austrian law does not provide for such an obligation to pay interest on arrears. However, the Federal Tax Code (Bundesabgabenordnung, BAO) contains various facts regarding interest, which the VwGH, in the context of the ECJ's decision, can use by analogy to resolve this conflict of norms between national law and EU law that is not directly applicable, such as Section 205 BAO, Sec. 205a BAO or Sec. 212 BAO.
Since all the BAO facts used set an interest rate of 2 percent above the basic interest rate, this is also applicable in the present case, according to the VwGH. The appellant's interest claim was therefore justified.
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