San Domenico Vetraria SpA v Agenzia delle Entrate, Ministero dell’Economia e delle Finanze

In San Domenico Vetraria SpA v Agenzia delle Entrate Ministero dell’Economia e delle Finanze (Case C-94/19) (11 March) the CJEU held that an Italian law which specified that the lending or secondment of staff at cost was outside the scope of VAT was precluded.

The appellant incurred charges in relation to the secondment to it of a director of its parent company. The authorities sought to disallow input tax recovery by the appellant on those charges on the grounds that they amounted to no more than the reimbursement of costs; as such under Italian law there was no consideration and therefore no supply.

The CJEU disagreed. If the referring court established that payment of the amounts invoiced was a condition of the secondment of the director there was a direct link between the two. Consequently there was a supply for consideration; whether...