Jumping Horse Exports to the United States via the Virgin Islands: No VAT Zero Rate

BV X, involved in the show jumping horses trade, sold one horse in 2012 for € 700,000 B, which was founded in the British Virgin Islands, where he sold it to a C. company based in the United States (USA). The horse was then taken to the United States in a tangle. BV X does not charge VAT on sales, but on the invoice it says “VAT changed”. He demanded a 0% rate on exports on his VAT income. After due diligence, the inspector imposed an additional estimate of € 133,000 (19% of 700,000). BV X appealed that selling the horse from B to C could not be enforced against it because it supplied the horse directly to Company C in the United States and exported on its behalf. Its distribution is linked to horse exports, thus applying a zero ratio according to BV X. Zeeland-West-Brabant District Court disagreed with BV X. According to the court, it is not possible to determine on the basis of the documents when the removal power of BV X ended. According to BV X’s statement, the court found that there was no written sales agreement, but it was significant what those agreements were (other than the sale amount) and that no documents showing BV X’s involvement in the next operation were submitted. As the study showed). The fact that the BV X horse was exported as part of its distribution does not make it credible. The court later rejected BV X’s alternative claim that the delivery took place in Belgium, not the Netherlands. BV X did not make it credible that its distribution was related to horse exports, and its argument that delivery took place as shipping began in Belgium was not successful. Nevertheless, the court declared that the appeal of BV X was well established because VAT could not be recovered from BV XB, thus adding unpaid VAT to the specified turnover. Therefore the additional estimate (19/119 x 700,000 =) should be reduced to € 111,764.

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