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Ryanair VAT Deduction OK in Failed Aer Lingus Deal: EU Court

Oct. 17, 2018, 11:51 AM

A top European court’s decision to permit Ryanair to deduct value-added tax on its unsuccessful takeover of Aer Lingus Group could significantly expand VAT deductions for corporations.

The European Court of Justice on Oct. 17 accepted an appeal by Ryanair Ltd. on VAT deductions related to the failed 2006 takeover bid. The airline argued the deduction should be allowed because it planned to provide management services as part of a corporate group with Aer Lingus as a subsidiary.

EU VAT law allows companies to deduct input VAT where there is a direct link between goods and services provided—a position the ...