Germany Fiscal Court Clarifies Input VAT Deduction, Place of Supply Rules for Advertising Services

The German Federal Fiscal Court April 9 posted online Decision No. V R 37/23, clarifying the input VAT deduction and place of supply rules for advertising services. The taxpayer, a company operating hotels and resorts in a non-EU country, maintained a German liaison office engaged in marketing and promotional activities. The taxpayer sought to deduct German input VAT, arguing that the services were attributable to its German permanent establishment. The Tax Office denied the claim. On appeal, the Federal Fiscal Court found that: 1) the advertising services weren’t taxable in Germany because they weren’t supplied to a German fixed establishment ...