A judgment of the EU Court of Justice concluded that a company having its principal establishment in an EU Member State may not take into account for reasons of calculating the deductible amount of VAT, the turnover of its foreign branches on 24 September 2013. This decision of the ECJ may have implications for VAT in Luxembourg. This decision affects all principal establishments which create turnover through their foreign branches.
By reason of the decision of the ECJ, the VAT authorities of Luxembourg could look this case as a chance to raise their focus on the calculation of the pro-rata of deductible input value added tax by taxpayers whose principal establishment is in Luxembourg and, possibly, to re-examine VAT for principal establishments.
