Attributes of Composition Scheme in VAT Regimes : Reflections From European Court of Justice

In a recent decision Shields & Sons Partnership - C-262/16 the European Court of Justice (‘ECJ') has adverted to the nuances of composition scheme in the context of Value Added Tax models. This decision examines the rationale for introduction of such scheme, which is the administrative simplification of the assessment procedure. The ECJ has also implored upon the tax-authorities to ensure that they do not tinker with the scheme, citing safeguards to save interests of revenue etc. as according to the ECJ the entire purpose of such schemes is to ensure that the tax collection is carried out with ease and without the need for substantial diversion of resources in case of specified and generally small taxpayers who are governed by such schemes