Supply of gas via natural gas distribution systems and the supply of electricity
On 13th December 2005 the Belgian VAT administration published a new decision concerning the supply of gas via natural gas distribution systems and the supply of electricity.
On 1 January 2005 new regulations concerning the place of delivery of gas via natural gas distribution systems and concerning the supply of electricity entered into force. These new regulations can have as a consequence that companies who perform cross border trade and cross border distribution of these goods will be confronted with high and permanent VAT credits.
The current regulation concerning the monthly VAT refund does not allow that deliveries of gas via natural gas distribution systems and supplies of electricity which are considered to took place in a foreign country, to be considered as exempted turnover.
However, for the application of the system of the monthly refund, the administration allows that certain supplies who are considered to take place abroad and whereby the concerned goods are destined for a foreign country can be added with the exempted turnover.
Since supplies, coming from Belgium, of gas via natural gas distribution systems and of electricity which according to Belgian law take place abroad are compatible with the mentioned criteria and in so far as the VAT credit arises from the pre-taxation over the concerned goods, the administration has decided that these transactions can be taken into account for the calculation of the exempted turnover.
For identical reasons, the transport of gas and electricity and actions that coincide herewith, can also be taken into account to calculate the exempted turnover on condition that they take place abroad according to article 21, § 3, 7°, l) of the Belgian VAT code. Official source.
