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United States and Belgium Sign Income Tax Treaty and
Protocol
Date: 13 July 2006
In the joined cases C-439/04
and C-440/04 (Axel Kittel v. Belgium and Belgium v. Recolta Recycling
SPRL), the Court of Justice of the European Communities has clarified
that if a taxpayer did not and could not know that a fraud
was connected with a transaction, he must not lose the right to
deduct VAT he has paid on the transaction.
By contrast, where it is ascertained by objective
factors that the taxpayer knew or should have known that by
purchasing, he was participating in a transaction connected with
fraudulent evasion of VAT, he can be denied the right to deduct the
VAT.
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