This paper provides a legal and economic analysis of the European Commission’s recent proposals for reforming the application of VAT to financial services, with particular focus on their “third pillar”, under which firms would be allowed to opt-into taxation on exempt insurance and...

The aim of this paper is to establish whether VAT place of supply rules are more effective allocation rules than international tax rules currently governing income taxation. This is done through the analysis of the “place where the activity is effectively carried out” (PWAECO) and the...

Transactions in shares are exempt under Article 135(1)(f) of the Common VAT System Directive. However, in practice, the legal regime applicable to shares is based not on the interpretation of one single provision of the Directive, but rather on the joint interpretation of various inter-connected...

The Court of Justice has been alluding to abuse and abusive practices in its rulings for more than thirty years. For a long time however the significance of these references was unclear. Not many commentators delved into this issue, and the few that did doubted whether the references by the...

On February 2006 the Court of Justice delivered its eagerly awaited ruling in Halifax, a case concerning the interpretation of EU secondary legislation on VAT. The judgment represented the culmination of a long process, with the Court referring for the first time to the 'principle of prohibiting...

Within Europe differentiated rates structures date back to the introduction of VAT itself. Evidence as regards the negative consequences of applying multiple rates has been apparent for some decades. In this context, since the late 1980s, there have been several attempts to amend European rates...

The current international tax system based upon the principles of source and residence is no longer suited to a globalised world economy, and the fundamentals of the international tax system need to be re-examined. An R+F based cash-flow tax based on the principle of destination has been...

The taxation of financial services is one of the most vexing aspects of a Value Added Tax (VAT). Conceptually, VAT should apply to any fee for service but where financial services are concerned there is a difficulty in identifying the taxable amount, i.e. the value added by financial...