Decisions of the Swiss Federal Administrative Court ( CW 22 - 2025)

Overview of the tax law decisions of the Swiss Federal Administrative Court published between May 26 and June 1, 2025:

Judgment of May 19, 2025 (A-6701/2024): Import assessment, refund of import tax (Art. 59 para. 2 VAT Act). X AG (freight forwarder) declared a shipment of pump parts for importer C with a customs duty of CHF 0.00 per 100 kg gross and a VAT value of CHF 37,745 for release into free circulation with the competent customs office. By assessment order of February 29, 2024, the customs office levied a customs duty of CHF 0.00 and an import tax amount of CHF 3,057.35 based on the customs declaration. The import tax was debited to the freight forwarder's settlement account. By submission of May 22, 2024, the freight forwarder requested a partial refund of the VAT from the customs office. The shipment was assessed at an excessive value due to an incorrect currency conversion (euros instead of Swedish kronor). The importer was unwilling to pay the VAT. The customs office referred the request to the responsible district customs directorate for reasons of jurisdiction. The district customs directorate treated the request as an appeal and rejected it with a decision dated September 26, 2024, on the grounds that the importer was registered as a taxable person in the country and could deduct the paid import tax as input tax according to Article 28 of the VAT Act. According to Article 59 (2) of the VAT Act, a refund is therefore excluded. The Federal Administrative Court disagrees. Failure to pay the invoice means that the importer has not paid the import tax, contrary to Article 28 (3) of the VAT Act. Therefore, the requirements of Article 59 (2) of the VAT Act are not met. The freight forwarder is therefore entitled to a refund of the import taxes it overpaid. From a procedural perspective, the responsible district customs directorate should have issued a first-instance order, which should have been appealed to the Higher Customs Directorate. However, for reasons of procedural efficiency, referral to the Higher Customs Directorate was waived. The taxpayer's appeal was upheld.
Judgment of May 23, 2025 (A-1035/2025): VAT (2020 and 2021); tax evasion; During the tax periods in dispute, married couples A and B each ran a sole proprietorship in the trust sector at the same location. The turnover limit of CHF 100,000 (Art. 10 para. 2 let. a of the VAT Act) was not reached by either sole proprietorship alone, but was reached together in the 2019 tax period. Following an audit, the Federal Tax Administration (SFTA) assumed tax evasion and combined the couples' two sole proprietorships as a single taxable entity from January 1, 2020. Based on the totality of the circumstances, the Federal Administrative Court concluded that the two sole proprietorships did not have an independent external presence. This already constituted tax evasion pursuant to Art. 10 para. 1 ^to let. b and Article 20 (1) of the VAT Act provide for a single taxable entity to which the services are to be attributed. However, the assumption of tax evasion is also not objectionable. The taxpayer's appeal is dismissed.

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