VAT Luggage Exemption Not For Resale Items, ECJ Says

Law360 (December 17, 2020, 6:17 PM EST) -- A value-added tax exemption on goods shipped out of the European Union in personal luggage doesn't apply to items shipped for resale, Europe's top court ruled Thursday, a setback for a Hungarian supplier of ornamental plants.

The European Court of Justice ruled the exemption was meant to promote tourism and did not apply to businesses or "economic operators." The plant supplier, Bakati Plus, had been accused by Hungarian tax authorities of running a scheme to avoid taxes by transporting commercial goods in personal luggage for resale to families in Serbia.

The Administrative and Labor Court in the city of Szeged, Hungary,...

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