Overview of the tax rulings of the Swiss Federal Administrative Court published in the week of October 21 - 27, 2019.
- Judgment of 4 June 2019 (A-3061/2018): VAT; cryopreservation of embryonic stem cells; supply vs. service; majority of services. In the present case, the question arises as to whether the services (cryopreservation of embryonic stem cells) provided by the company lodging the complaint to the future parents constitute a supply pursuant to Art. 3 lit. d VAT Act or a service pursuant to Art. 3 lit. e VAT Act. In addition, it is questionable whether this concerns a majority of services pursuant to Art. 19 VAT Act or medical services within the meaning of Art. 21 para. 2 subparas. 2-5 VAT Act which are exempt from tax. The BVGer confirmed the decision of the FTA and stated that the services in question were a supply that was not exempt from tax. The services in the form of cryopreservation of embryonic stem cells are to be regarded as a majority of services under Article 19(3) of the VAT Act, since the processing process - from the removal of embryonic stem cells from the umbilical cord to cryopreservation - is to be regarded as an indivisible whole. Furthermore, this is not a deposit within the meaning of Art. 472 et seq. OR, as the complainant submitted as an argument for the existence of a service: The processing process constitutes the core content of the cryopreservation, which, from a VAT point of view, constitutes a supply under Article 3(d) of the VAT Act. Since the services provided by the complainant will not be used for medical treatment in the short term and will not even serve to diagnose or diagnose a disease, there was no medical service exempt from tax. Rejection of the taxpayer's complaint.
- Judgment of 3 May 2019 (A-956/2019): Withholding tax; rejection of request for revision and reassessment. In particular, it is not possible to submit facts which could have been submitted in the previous proceedings. Furthermore, there is no legal justification for the tax period 2006-2009; the complaint of the taxpayers has been rejected.
- Judgment of 15 February 2018 (A-2186/2018): Customs; operating licence for an open customs warehouse (OZL); infringement of the right to be heard; in the present case, the complainant is a company operating in the field of international transport and freight forwarding and holding an open customs warehouse (OZL) licence for an indefinite period. As the company did not comply with the 200 entries and extensions provided for by the FCA in the corresponding directive on open customs warehouses, it was revoked its operating licence for an indefinite period of time and granted a one-year licence. Before the Federal Administrative Court, the complainant asserted the violation of the right to be heard. The SNB approved the taxpayers' complaint on the grounds that the FCA had withdrawn the operating licence and replaced it with a limited licence, but without stating the reasons and the legal basis on which it was based. The FCA therefore failed to fulfil its obligation to state reasons and consequently infringed the complainant's right to be heard.
- Judgment of 14 October 2019 (A-5205/2018, A-5206/2018): VAT (VAT); joint and several liability liquidator/administrator; the scope of liability for the liquidator's liability is (also) limited in the case of VAT to the amount of the liquidation result. However, this is not just a limitation of liability; the fact that a liquidation result exists at all is also a condition of liquidator liability. If no positive liquidation result remains after deduction of debts and liquidation costs, the joint and several liability shall no longer apply. The decisive starting point for determining the liquidation result is the company's total assets at the start of the liquidation. As with withholding tax, a de facto liquidation is also conceivable. The assumption of a de facto liquidation requires the sale of assets and the distribution of proceeds to shareholders or related parties. Furthermore, it is demanded that the company be "hollowed out" so that ordinary business activity is no longer possible. This, in turn, requires the sale of assets essential for the operation of the company. This was not the case here, which is why the start of formal liquidation is decisive here. In this case, liquidation began with the approval of an inheritance agreement with assignment of assets, as the liquidation (with liquidation of the assets) is only to be carried out after the legally stipulated expiry of this approval. In particular, the question as to whether the complainant (as assumed by the FTA) had already been liable as administrator or only in his later capacity as liquidator was left open.
- Judgment of 14 October 2019 (A-4632/2019): Import duties; obligation to provide subsequent performance (import of horses); if the Federal Supreme Court complains about insufficient collection or acceptance and appraisal of evidence by the Federal Administrative Court (see our contribution of 22 September 2019), the same accusation can be made against the lower instance (OZD). The case is referred back to the lower court for further clarification ('renvoi sur renvoi').
Decisions of the Federal Administrative Court in the area of administrative assistance:
- Judgment of 10 July 2019 (A-837/2019): Administrative assistance DBA Switzerland - India (IN); the complaint is approved and the decision is referred back to the lower instance for reassessment.
Decisions are listed chronologically by publication date.
