Tue. Feb 7th, 2023

See question(s) : P-007002/2020
Source : © European Union, 2021 – EP

Parliamentary questions
24 February 2021

P-007002/2020(ASW)
Answer given by Mr Gentiloni
on behalf of the European Commission
Question reference: P-007002/2020

The provision of advertising space, including banner ads, on a website/web page, is a supply of services for VAT purposes(1). The following situations regarding the provision of these services are relevant in this regard(2):

— Supplier and business customer(3) established in the same Member State: the supplier charges on the customer the VAT of that Member State.

— Business customer established in a Member State and supplier established in another Member State or outside the European Union: the supplier does not charge VAT on the customer but the customer has to account for VAT in the Member State where it is established(4).

— Non-business customer(5) established in a Member State: the supplier (wherever it is established) must charge the VAT of that Member State.

The Member States are required to ensure compliance with the VAT obligations to which taxable persons are subject and they enjoy in that respect a certain measure of latitude as to how they use the means at their disposal(6). The Commission does not have any evidence that the above rules are not being complied with by Facebook or that a Member State fails to ensure compliance with those rules. The matter is not covered by Directive 2008/118/EC(7).

The Commission does not have any contracts with Facebook. In consequence, no contracts with Facebook as a beneficiary were published on the Financial Transparency System(8) for the financial year 2019. For its social media paid advertising campaigns, the Commission works with agencies through available Framework contracts. The Commission is exempt from VAT on all substantial purchases for its official use(9).


(1) That supply will be subject to VAT when made for consideration within the territory of a Member State by a taxable person acting as such, according to Article 2(1)(c) of the VAT Directive (Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, OJ 347, 11.12.2006, p. 1).

(2) Articles 44 and 58(1) of the VAT Directive, as well as Article 7(2) (f) and Annex I point

(3) (h) to Council Implementing Regulation (EU) No 282/2011 of 15 March 2011 laying down implementing measures for Directive 2006/112/EC on the common system of value added tax (recast), OJ L 77, 23.3.2011, p. 1. The supplies at stake qualify as electronically supplied services. It is assumed that in this case the exception in Article 58(2) of the VAT Directive does not apply, since it refers to a supplier established only in one Member State.

(3) Taxable person or non-taxable legal person identified for VAT purposes.

(4) Through the reverse charge mechanism: Article 196 of the VAT Directive.

(5) Non-taxable person, except a non-taxable legal person identified for VAT purposes.

(6) Judgment of 17 July 2008, Commission v Italy, C-132/06, ECLI:EU:C:2008:412, paragraph 38.

(7) Council Directive 2008/118/EC of 16 December 2008 concerning the general arrangements for excise duty and repealing Directive 92/12/EEC, OJ L 9, 14.1.2009, p. 12.

(8) Which publishes EU budget beneficiaries directly administered by the Commission departments, its staff in the EU delegations, through executive agencies and of the European Development Fund. It does not provide information on EU budget funding implemented in shared management or indirectly (by other international organisations or non-EU countries), nor on very low value contracts below EUR 15 000.

(9) Article 151(1) (aa) of the VAT Directive referring to the Protocol of 8 April 1965 on the privileges and immunities of the European Communities.
Last updated: 24 February 2021

Source: Answer to a written question – Facebook’s VAT practices – P-007002/2020(ASW)

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