VAT: Supplies of vouchers to employees
In AstraZeneca UK Ltd v HMRC (ECJ Case C-40/09) a pharmaceutical company gave its employees face-value vouchers as part of their remuneration. HMRC issued a ruling that this was a supply of services for consideration which was subject to VAT. The company appealed contending that it was not making any supply of services but that it should be allowed an input tax deduction on the costs of purchasing and providing the vouchers. The tribunal referred the case to the ECJ. Advocate-General Mengozzi rejected the company's contentions observing that 'the burden of the tax ultimately rests in accordance with the general principles governing VAT with the final consumer of the products namely the employee' and that 'unlike money retail vouchers cannot be used everywhere but only at the premises of the retailers who issued them'. He concluded...
