The taxpayer’s dispute with the tax authorities centered around determining whether the ICS rate should be applied to the movement of own goods from the online platform’s warehouses in Poland to other EU countries. Specifically, the disagreement focused on whether the platform’s reports adequately documented the movement of goods to other countries.
The online platform functions as a cross-border network of warehouses, where the movement between warehouses corresponds to the movement of goods across different countries.
By participating in the PAN-UE program, sellers transfer their rights to distribute and store their own stock in various countries within the EU to the online trading platform. The platform charges for shipping, and sellers have the option to use “Fulfillment by Amazon” (FBA), wherein the platform handles the shipping process to customers on behalf of the sellers. Sellers who choose FBA deliver their items to designated warehouses, and based on an algorithm, the platform determines the European region with the highest demand for a particular product and moves the goods to warehouses nearest to potential buyers.
The platform is responsible for the transportation of goods, and the document provided by the platform should be considered a transport document for VAT purposes. Hence, the platform should be treated as a carrier or forwarder, supported by the detailed information in the reports, which document the inter-warehouse movements and specify individual pieces of cargo.
One peculiarity of using the platform’s services is that the seller may not require additional documents, other than the reports, which the authorities deem insufficient to document the ICS.
In an intra-Community supply, the taxation occurs in the destination country where the goods are ultimately moved. Such supplies are VAT-exempt with the right to deduct and taxed at a 0% rate. This exemption avoids double taxation and upholds the principle of fiscal neutrality upon which the common VAT system is based.
The transfer of a taxpayer’s own goods from one country to another within the EU represents a specific type of intra-Community supply. The general principles for intra-Community supplies of goods should be applied “appropriately,” meaning some provisions are applied directly without modifications, while others are adjusted to suit the specific circumstances. Sometimes, certain rules may not be applicable due to their inherent nature.
In the case of an intra-Community supply of own goods, the person moving the goods assumes the roles of both the supplier and the purchaser, as there is no transfer of ownership rights over the goods.
As a result, certain general regulations related to commercial correspondence and payment for goods can be omitted when documenting the movement of own goods since there is no correspondence or payment involved within the same entity.
The regulations require relevant export and delivery documents to apply the 0% rate for intra-Community supplies. However, in the case of an intra-Community transfer of goods, it is not possible to present a document confirming the export and delivery of goods to a buyer in another member state. Instead, the taxpayer should have documentation proving that their own goods, subject to intra-Community supplies, were exported from the country and delivered to a warehouse in a different EU member state.
In the case of non-transactional transfers of own goods, the taxpayer is still obligated to issue an invoice. While the invoice should contain all the necessary elements, considering the nature of non-transactional deliveries under the ICS, it is important to note that the invoice alone does not prove the ICS or the movement of goods between countries. Therefore, it is irrelevant whether a taxpayer with a Polish VAT-EU number issues invoices to themselves or uses a VAT-EU number assigned in another country to assess the movement of goods.
Failure to issue VAT invoices for intra-Community transfers may, however, indicate non-compliance with obligations related to VAT invoice issuance.
In cases involving traditional CMR-documented deliveries, the authorities typically request confirmation of the circumstances described in the consignment note and investigate the release and loading of goods, sometimes even interviewing drivers involved in specific deliveries.
The VAT Act does not specify the form of the transport document. As long as the content demonstrates that goods were exported from Poland, taxpayers may present various document formats to confirm non-transactional movements of goods. Consequently, the credibility and completeness of the reports generated by the platform are often at the core of disputes in online trading cases.
Disputed online transactions are commonly documented through reports, which record sales transactions by the platform in the form of an Excel file. These reports are usually accompanied by explanations from the platform regarding their structure and the terms and conditions of the platform’s services in Europe.
The Excel-based waybill differs from the traditional CMR document used when the owner of the goods (buyer or seller) or a hired carrier/forwarder handles the transport. There is no universally recognized, traditional form for moving goods internationally governed by Incoterms standards since it depends on the owner’s decision.
When evaluating evidence, including the reports from the platform, the general principles of law (including tax law) require logical assessment based on life experience. Given the specific nature of global e-commerce using automated warehouses across multiple countries, the existing experience in examining bills of lading, where forwarders act solely as carriers, needs to be adapted.
Therefore, the same rules of proof used to assess the value of other consignment notes, particularly CMRs, should be applied to evaluate the content of the Excel-based waybill.
According to administrative courts, it is arbitrary for tax authorities to disregard the sufficiency of the platform’s reports as evidence of goods movement under the ICS. Such disregard violates the principles of objective truth and trust.
In a case represented by our law firm, the court overturned the decision of the tax authorities and concluded that the allegations of inadequate ICS documentation were incorrect.
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