© 2025 by Michael Firth KC, Gray's Inn Tax Chambers
Contact: michael.firth@taxbar.com
H2. Exemptions subject to a supplier condition
GENERAL
- Specific types of supplier identified (Article 132)
Post: the public postal service
(a) the supply by the public postal services of services other than passenger transport and telecommunications services, and the supply of goods incidental thereto;
Medical/dental professionals
(c)the provision of medical care in the exercise of the medical and paramedical professions as defined by the Member State concerned;
(e)the supply of services by dental technicians in their professional capacity and the supply of dental prostheses by dentists and dental technicians;
Private tuition: teachers
(j)tuition given privately by teachers and covering school or university education;
Supply of staff for welfare: religious or philosophical institutions
(k)the supply of staff by religious or philosophical institutions for the purpose of the activities referred to in points (b), (g), (h) and (i) and with a view to spiritual welfare;
Subscriptions: non-profit-making organisations with certain aims
(l)the supply of services, and the supply of goods closely linked thereto, to their members in their common interest in return for a subscription fixed in accordance with their rules by non-profit-making organisations with aims of a political, trade-union, religious, patriotic, philosophical, philanthropic or civic nature, provided that this exemption is not likely to cause distortion of competition;
Sport: non-profit-making organisations
(m) the supply of certain services closely linked to sport or physical education by non-profit-making organisations to persons taking part in sport or physical education;
Radio and television: public radio and television bodies
(q)the activities, other than those of a commercial nature, carried out by public radio and television bodies.
- Public bodies/recognised entities
Medical: public bodies or - if under comparable social conditions - hospitals, medical centres, "other duly recognised establishments of a similar nature"
"(b) hospital and medical care and closely related activities undertaken
[i] by bodies governed by public law or,
[ii]under social conditions comparable with those applicable to bodies governed by public law, by
hospitals,
centres for medical treatment or diagnosis and
other duly recognised establishments of a similar nature;" (formatting added)
Welfare: public bodies and other organisations 'recognised...as...devoted to social wellbeing"
(g) the supply of services and of goods closely linked to welfare and social security work, including those supplied by old people's homes, by bodies governed by public law or by other bodies recognised by the Member State concerned as being devoted to social wellbeing;
Protection of children: public bodies and other organisations 'recognised...as...devoted to social wellbeing"
(h) the supply of services and of goods closely linked to the protection of children and young persons by bodies governed by public law or by other organisations recognised by the Member State concerned as being devoted to social wellbeing;
Education: public bodies "having such as their aim", other organisations recognised "as having similar objects"
(i) the provision of children's or young people's education, school or university education, vocational training or retraining, including the supply of services and of goods closely related thereto, by bodies governed by public law having such as their aim or by other organisations recognised by the Member State concerned as having similar objects;
Cultural services: public bodies and "other cultural bodies recognised by the Member State"
(n) the supply of certain cultural services, and the supply of goods closely linked thereto, by bodies governed by public law or by other cultural bodies recognised by the Member State concerned;
Transporting sick persons: "duly authorised bodies"
(p)the supply of transport services for sick or injured persons in vehicles specially designed for the purpose, by duly authorised bodies;
- Supplier condition means supplies in competition may be treated differently
"[36] In this connection, it should be observed that the scope of the exemptions in Article 132(1)(b), (g), (h), (i), (l), (m) and (n) of Directive 2006/112 is defined not only by reference to the substance of the transactions covered, but also by reference to certain criteria that the suppliers must satisfy. In providing for exemptions from VAT defined by reference to such criteria, the common system of VAT implies the existence of divergent conditions of competition for different operators." (Bridport and West Dorset Golf Club Limited C-495/12)
- Purpose of supplier conditions: allowing private bodies to benefit if they supply in similar context to public bodies
"[86] Concerning the objectives pursued by the third condition referred to in Article 132(1)(b) of the VAT Directive, it seems clear that such an objective is to prevent private establishments from offering VAT-exempt services without having to bear the same social obligations of their public law counterparts. This is perhaps just another way of referring to the public service obligations of a social nature imposed on public hospitals and other medical establishments. (60) That condition therefore givesparticular expression to the principles of non-discrimination and of fiscal neutrality as between private bodies and public bodies, especially since, on the one hand, hospital and medical care and closely related activities undertaken by the latter are always exempted and, on the other hand, the former are not necessarily subject to the same social public service obligations.
[87] As regards the wording of Article 132(1)(b) of the VAT Directive, it is clear from the actual text of that provision that a comparison has to be made between hospitals governed by public law, on the one hand, and private hospitals, on the other.
[88] Since the objective of this condition is to ensure fair competition between public and private bodies, this condition is double-sided. It prevents private establishments from offering VAT-exempt services where they do not undertake the same public service obligations imposed on public establishments. Conversely, since the services provided by public bodies are always exempt from VAT, it allows private entities which are subject to the same obligations (or which voluntarily assume them) also to benefit from this VAT exemption." (I GmbH C-228/20 AG Hogan)
- Caution re use of authorities on differently worded supplier condition
"[91] Mr Lasok sought to meet that difficulty in two ways. Firstly, he cited Case C-174/11 Finanzamt Steglitz v Zimmermann 15.11.2012 (at paragraphs 43 and 53) as authority that the principle of fiscal neutrality does not require equal treatment for bodies governed by public law and other organisations within Article 13A(1)(i). The case did not in fact concern the exemption in Article 13A(1)(i). It concerned Article 13A(1)(g) and turned on the wording of that particular provision. I do not regard it as authority for the proper application of the principle of fiscal neutrality to Article 13A(1)(i)." (HMRC v. Open University [2016] EWCA Civ 114, Etherton, Lewison LJJ)
Organisations, bodies and individuals
- "Organisations recognised as charitable" not calling for a particularly narrow construction
"[32] Secondly, the expression ‘organisations recognised as charitable’ in Article 13A(1)(g) and (h) of the Sixth Directive does not call for a particularly narrow construction (see, to that effect, Dornier, cited above, paragraph 48)." (Kingcrest Associates Ltd C-498/03 - directive no refers to bodies devoted to social wellbeing)
- Organisation includes natural persons
"[36] Thus the Court has already held, in respect of a private entity aiming to make a profit, that the expression ‘other organisations recognised as charitable by the Member State concerned’ in Article 13A(1)(g) of the Sixth Directive does not exclude from that exemption natural persons running a ‘business’ (see Gregg, cited above, paragraph 21)." (Kingcrest Associates Ltd C-498/03)
- Soloist musicians can rely on the exemption for cultural services as "cultural bodies"
"[27] Consequently, the principle of fiscal neutrality requires that individual performers, as long as their services are recognised as cultural, may be regarded, like cultural groups, as bodies similar to public-law bodies supplying certain cultural services mentioned in Article 13A(1)(n) of the Sixth Directive." (Hoffmann C-144/00)
Powers to define not to be used to select some, but not other entities within scope of definition
"[41] The power to define thereby accorded to the Member States is, however, limited by the prohibition on undermining the very terms of the exemption that are employed by the EU legislature (see, to that effect, JP Morgan Fleming, paragraph 21, and Wheels, paragraph 17). A Member State cannot in particular, without negating the very terms ‘special investment funds’, select from among special investment funds those which are eligible for the exemption and those which are not. Article 13B(d)(6) of the Sixth Directive thus grants a Member State only the power to identify, through its domestic law, the funds which meet the definition of ‘special investment funds’ (see, to that effect, JP Morgan Fleming, paragraphs 41 to 43, and Wheels, paragraph 17)." (ATP PensionService A/S C-464/12)
PUBLIC BODIES
- BBC not body governed by public law because no power for state to dictate content of broadcasting
"[85] By contrast and critically, as expressly acknowledged by the 1981 Resolution, there was no power on the part of the state under the documents governing the BBC during the relevant period to dictate the subject matter and content of the BBC's radio or television broadcasts. The FTT found as a fact that the BBC had operational and editorial independence from the state. That being so, notwithstanding all the provisions in the BBC's governing documents concerning the powers of the Crown and the Secretary of State, the promotion of the public benefit by the BBC's activities, the BBC's funding, and the fact that the BBC is governed by a royal charter and must report and account to Parliament, it seems to me plain (as it did to the FTT and the UT) that during the relevant period the BBC was not carrying on its activities as part of the public administration." (HMRC v. Open University [2016] EWCA Civ 114, Etherton, Lewison LJJ)
RECOGNITION PROCEDURE
- UK universities are not bodies governed by public law
"[36] Ms Hall submits that the fiscal neutrality principle is breached because universities are the appropriate comparators for (non-university) providers of university education, such as FBT (I am of course assuming relevant differential treatment because of the all or nothing and mainly acting rules). This is not strictly correct because under UK VAT law, universities are not "bodies governed by public law": see University of Cambridge v HMRC [2009] STC 1288, which decides that universities do not form part of the public administration of the UK. FBT has to show that it has similar objects to bodies governed by public law having "such as their aim", that is, having as their aim "the provision of children's or young people's education, school or university education, vocational training or retraining" (Article 132.1(i) of the PVD)." (Finance and Business Training Limited v. HMRC [2016] EWCA Civ 7, Arden Golster, Sharp LJJ)
- Member states permitted but not required to lay down formal recognition measures
"[41] Such recognition does not presuppose a formal recognition procedure and need not necessarily be derived from national tax law provisions (see, to that effect, judgment of 10 June 2010, CopyGene, C‑262/08, EU:C:2010:328, paragraph 61)." (I GmbH C-228/20)
"[64] As regards the term other duly recognised establishments of a similar nature, Article 13A(1)(b) of the Sixth Directive does not specify the conditions and procedures for that recognition. It is thus, in principle, for the national law of each Member State to lay down the rules according to which such recognition may be granted to establishments which request it.
...
[67] In addition, no provision of the Sixth Directive requires that recognition be granted in accordance with a formal procedure or that it be provided for expressly in national tax provisions." (Dornier C-45/01)
- Member state with taxing jurisdiction
"[81] Therefore, it is apparent from a literal, systematic and teleological interpretation of Article 132(1)(g) of the VAT Directive that recognising the social wellbeing of bodies other than those governed by public law for the purposes of the exemption provided for under Article 132(1)(g) of the VAT Directive falls within the right of the Member State of taxation." (Momtrade Ruse C-620/21)
- For national courts to supervise recognition conditions laid down
"[69] It should be borne in mind in this context that, as regards Article 13A(1)(g) of the Sixth Directive, the Court has held that where a taxable person seeks the status of charitable organisation, it is for the national courts to examine whether the competent authorities have observed the limits on their discretion under that provision while applying Community principles, in particular the principle of equal treatment (Kügler, cited above, paragraph 56)." (Dornier C-45/01)
- Not permitted to characterise a body that is devoted to social wellbeing as not being such a body
"[71] Accordingly, the right that Member States have in relation to the recognition of an entity as a body devoted to social wellbeing for the purposes of the exemption provided under Article 132(1)(g) of the VAT Directive, does not entitle Member States to change the sense of that exemption, by characterising, for example, a body devoted to social wellbeing, within the meaning of that provision, as a private entity that doesn’t carry out services of general interest in the social sector or that its manner of carrying out and conditions for the supply of social services are incompatible with a body devoted to social wellbeing." (Momtrade Ruse C-620/21)
- Not permitted to refuse recognition without a precise examination of the specific circumstances to establish if, e.g., devoted to social wellbeing
"[76] Thirdly, although, for the purposes of recognising a person supplying services as being a body devoted to social wellbeing, the form of exploitation chosen by the person supplying services is not irrelevant, since it must not prove incompatible with the classification of ‘body devoted to social wellbeing’, the fact remains that Member States cannot refuse such recognition without a precise examination of the specific circumstances of the case, in order to ascertain whether they are capable of establishing that the business operated by such a person is devoted to social wellbeing, with the result that, if it is established that it is devoted to social wellbeing and in so far as that person supplies services closely linked to welfare and social assistance work, those supplies fall within the exemption provided for in Article 132(1)(g) of the VAT Directive." (EQ C-846/19)
- No a priori assumption that particular types of profession are excluded
"[78] However, it does not follow from that case-law that a taxable person carrying out activities closely linked to welfare and social security work may, in all circumstances and a priori, be excluded from the possibility of being recognised as being a body devoted to social wellbeing solely on the ground that that person belongs to the professional category defined in the preceding paragraph, without examining whether that person operates his or her business in conditions justifying recognition as being a body devoted to social wellbeing within the meaning of Article 132(1)(g) of the VAT Directive. Such an approach would, moreover, be liable to conflict with the principle of fiscal neutrality, as also noted, in essence, by the Advocate General in points 90 and 95 of his Opinion.
[79] Even if the professional category of lawyers cannot be characterised, as a whole, as being devoted to social wellbeing, it is conceivable that, in a specific case, a lawyer providing services closely linked to welfare and social security work may show a stable social engagement and, in the light of the factors to be taken into account for the purposes of establishing the social nature of his or her business, cannot be distinguished from other natural or legal persons providing such services except by the fact that that person is a member of the Bar.
[80] In such a situation, the mere fact that the person supplying services is a lawyer is a purely formal element which cannot call into question the social nature of his or her business." (EQ C-846/19)
- Recognition criteria to be tested against equal treatment and fiscal neutrality
"[87] The application of such criteria must, however, comply with the principle of fiscal neutrality. Thus, in the main proceedings, it is necessary to determine whether other taxable persons, including not-for-profit associations, already enjoy similar recognition in circumstances similar to those prevailing in the situation of the applicant in the main proceedings, an aspect on which he and the Luxembourg Government, in their written replies to the questions put by the Court, have adopted diverging views." (EQ C-846/19)
"[64] Where a taxable person seeks the status of an establishment duly recognised for the purposes of Article 13A(1)(b) of the Sixth Directive, it is for the competent authorities to observe the limits of the discretion conferred upon them by the latter provision in applying the principles of European Union law, in particular the principle of equal treatment which, in the field of VAT, takes the form of the principle of fiscal neutrality (see, to that effect, Dornier, paragraph 69, and L.u.P., paragraph 48)." (Copygene C-262/08)
"[74] In the case in the main proceedings, it is therefore for the national court to determine, in the light of all of those factors, whether the refusal to recognise Dornier for the purposes of the exemption provided for in Article 13A(1)(b) of the Sixth Directive gives rise to an infringement of the principle of equal treatment as compared to other operators providing the same treatment in comparable situations." (Dornier C-45/01)
- Registration as a supplier of social services may amount to recognition
"[96] In the light of that case-law, it must be found that the registration of a company, at a public body governed by the law of the Member State of taxation, as a supplier of social services in accordance with the legislation of that Member State, may be a criteria to take into account for the purpose of ascertaining whether that company falls within the concept of a ‘[body recognised] as being devoted to social wellbeing by the Member State concerned’, within the meaning of Article 132(1)(g) of the VAT Directive, in particular where companies thus registered are systematically or habitually considered by the tax authorities of that Member State as such bodies. Such a registration can, however, only allow for the company concerned to fall within that concept where it requires the prior inspection by the competent national authorities, considering the factors raised in paragraphs 91 to 94 of the present judgment, of the social wellbeing of that company for the purposes of that provision." (Momtrade Ruse C-620/21)
- May make recognition dependent on taking certain procedural steps
"[86] Similarly, there is nothing to prevent the Member State concerned from making such recognition subject to the requirement that the person supplying services must take certain procedural steps to that end, since such steps are likely to enable the authorities concerned to ascertain whether the person supplying services is devoted to social wellbeing. It seems, however, that, as regards the exemption provided for by the national provision transposing Article 132(1)(g) of the VAT Directive, Luxembourg law does not require such steps to be taken, which is, however, a matter for the referring court to verify." (EQ C-846/19)
- Where no recognition conditions laid down/incompatible conditions, for national court to determine
"[82] In the present case, it follows from the answer given to the second question that the national rules pertaining to recognition of an establishment for the purposes of the exemption provided for in Article 13A(1)(b) of the Sixth Directive contain a restriction incompatible with the terms of that provision. The taxable person may therefore rely directly, in the national court, on Article 13A(1)(b) of the Sixth Directive to contest the application of a rule of national law requiring that the treatment be provided under medical supervision. However, it also follows from the answer to the second question that, in order for it to obtain recognition as an other duly recognised establishment of a similar nature and thus to benefit from the exemption provided for in Article 13A(1)(b) of the Sixth Directive, the national court must determine, in the light of all the relevant factors, in particular the circumstances of the case in the main proceedings, whether the taxable person satisfies the conditions of application of that exemption." (Dornier C-45/01)
- National court is determining whether recognised as (for example) devoted to social wellbeing
"[92] Furthermore, as stated in paragraph 67 of the present judgment, the exemption provided for in Article 132(1)(g) of the VAT Directive may be relied upon by a taxable person before a national court in order to oppose national rules incompatible with that provision. In such cases, it is for the national court to establish, in the light of all relevant factors, whether the taxable person is a body recognised as being devoted to social wellbeing for the purposes of that provision (judgment of 15 November 2012, Zimmermann, C‑174/11, EU:C:2012:716, paragraph 32 and the case-law cited)." (Momtrade Ruse C-620/21)
"[45] It is only if the Member State has failed to observe the limits of its discretion that the taxable person may invoke the exemption provided for in Article 132(1)(g) of the VAT Directive in order to oppose national rules incompatible with that provision. In that case, it is for the national court to establish, in the light of all relevant factors, whether the taxable person is an organisation recognised as being devoted to social wellbeing for the purposes of that provision (see, to that effect, judgment of 15 November 2012, Zimmermann, C‑174/11, EU:C:2012:716, paragraphs 28 and 32)." (Finanzamt D C-657/19)
- Use of a supplier by a person who does have recognition does not amount recognition
"[50] Moreover, inferring recognition as a body devoted to social wellbeing from the mere fact that the taxable person concerned has been appointed by another taxable person already recognised as such would ultimately be tantamount to authorising the latter to exercise the discretion accorded to the Member State and would be liable, as the German Government, in essence, observes, to allow circumvention of the criteria set by national law for the purposes of granting that recognition." (Finanzamt D C-657/19)
- Challenge to non-recognition before national court
"[45] Sixthly, the exemption provided for in Article 13(A)(1)(g) may be relied upon by a taxable person before a national court in order to oppose national rules incompatible with that provision. In such cases, it is for the national court to establish, in the light of all relevant factors, whether the taxable person is an organisation recognised as "charitable" for the purposes of that provision: Kügler at [61]; and Zimmerman at [32]
[46] Seventhly, where a taxable person challenges the recognition, or the absence of recognition, of an organisation as "charitable" for the purposes of Article 13A(1)(g), it is for the national courts to examine whether the competent authorities have observed the limits of the discretion granted by that provision whilst applying the principles of EU law, including, in particular, the principle of equal treatment, which, in the field of VAT, takes the form of the principle of fiscal neutrality: Kügler at [56]; Kingscrest at [52] and [54]; and Zimmerman at [33]." (LIFE v. HMRC [2020] EWCA Civ 452, Arnold, Floyd, Newey LJJ)
PERMISSIBLE LIMITS ON RECOGNITION: GENERAL
Not permissible to impose recognition conditions related to the subject-matter of the exemption
- Medical exemption cannot be limited by reference to whether the medical care is supervised
"[51] Next, in so far as the national legislation makes the exemption of medical care such as that at issue in the main proceedings subject to those conditions, which it is for the national court to determine, it should be borne in mind that the Court has held previously that the condition requiring that the treatment be provided under medical supervision, in so far as it is intended to preclude the exemption from applying to treatment given under the sole responsibility of members of paramedical professions, goes beyond the limits of the discretion allowed to the Member States under Article 13A(1)(b) of the Sixth Directive. The term ‘medical care’ in that provision covers not only treatment provided directly by doctors or other health professionals under medical supervision, but also paramedical services given in hospitals under the sole responsibility of persons who are not doctors (Dornier, paragraph 70).
[52] It follows that, for the purposes of the exemption provided for in Article 13A(1)(b) of the Sixth Directive, a Member State may not validly make recognition of establishments governed by private law subject to a condition requiring that the tests carried out by those establishments be done under medical supervision (see, to that effect, Dornier, paragraphs 71 and 82)." (LUP C-106/05)
Applying specific recognition conditions to some private bodies but not others
- The purpose of the 'recognised as charitable' restriction is not to align such non-public bodies with public bodies
"[52] Accordingly, the principle of fiscal neutrality does not preclude, for example, the situation under Article 13A(1)(g) of the Sixth Directive, whereby, for the purposes of the exemption, it is unnecessary for bodies governed by public law to be recognised as ‘charitable’, but such recognition is required in the case of organisations other than bodies governed by public law." (Zimmermann C-174/11)
- Equal treatment required of non-public bodies
"[53] As is apparent from paragraphs 42 and 52 above, in the context of the exemption provided for under Article 13(1)(g) of the Sixth Directive, it is not in relation to bodies governed by public law that the principle of fiscal neutrality requires equal treatment in terms of recognition as ‘charitable’, but in relation to all other organisations, each as compared with the others." (Zimmermann C-174/11)
- Private law operators must each be subject to the same conditions for the purpose of recognition
"[63] In the implementation of the exemption laid down in Article 132(1)(b) of the VAT Directive, compliance with fiscal neutrality requires, inter alia, that all organisations other than those governed by public law should be placed on an equal footing for the purpose of their recognition for the supply of similar services (see, to that effect, judgment of 8 June 2006, L.u.P., C‑106/05, EU:C:2006:380, paragraph 50)." (I GmbH C-228/20)
"[50] It may be stated at the outset that compliance with the principle of fiscal neutrality requires, first, that all of the categories of establishments governed by private law referred to in Article 13A(1)(b) of the Sixth Directive be subject to the same conditions for the purpose of their recognition for the provision of similar services. In the present case, therefore, it is for the national court to ascertain whether the national legislation complies with that requirement or whether, on the contrary, it restricts the application of the conditions in question to certain types of establishments whilst excluding others." (LUP C-106/05)
- Are private law persons carrying on the same activity in similar circumstances entitled to recognition?
"[52] Third, it is not apparent from the file before the Court that other taxable persons governed by private law, which carry out the same activities as the defendant in the main proceedings, in circumstances similar to those of her situation, would be entitled to recognition as bodies devoted to social wellbeing. Consequently, subject to verification by the referring court, a refusal to grant, in the present case, such recognition does not appear to breach the principle of fiscal neutrality." (Finanzamt D C-657/19)
- Not permissible to refuse to recognise on the basis that there is already sufficient supply capacity
[67] The referring court states, in that regard, as mentioned in paragraph 21 above, that the consequence of applying the national legislation at issue is that the exemption provided for in Article 132(1)(b) of the VAT Directive applies only if the services supplied by the private hospital in question meet specified needs under social security law. Thus, in practice, a private hospital would have no prospect of being included in the hospital plan for the Land in which it is located or of concluding care supply contracts with the statutory health insurance funds if enough hospital beds for a particular speciality are already available within the Land in question.
[68] As the Advocate General observed in points 111 and 112 of his Opinion, it follows from the information provided by the referring court that the providers of statutory accident insurance, the Land-level health insurance fund associations and substitute fund associations all enjoy a discretion as to whether to conclude an agreement with a hospital and that the Länder are not obliged to include in their hospital plan private non-university hospitals that carry on their activities under social conditions comparable with those applicable to bodies governed by public law.
[69] The exercise of such discretion depending on needs defined under social security law may, contrary to the principle of fiscal neutrality, result in similar private hospitals being treated differently as regards the exemption laid down in Article 132(1)(b) of the VAT Directive in respect of similar services supplied under social conditions comparable with those applicable to bodies governed by public law." (I GmbH C-228/20)
- Not permissible to distinguish based on how costs of supplies are funded that only applies to some candidates for exemption
"[63] In the light of all the foregoing considerations, the answer to the questions referred is that, under Article 13A(1)(g) of the Sixth Directive, interpreted in the light of the principle of fiscal neutrality, the VAT exemption for out-patient services supplied by commercial service-providers may not be made subject to a condition such as that at issue in the main proceedings, by virtue of which the costs relating to those services must, during the preceding calendar year, have been borne wholly or partly by the statutory social security or social welfare authorities in at least two thirds of cases, where that condition is not capable of ensuring equal treatment in relation to the recognition, for the purposes of that provision, of the ‘charitable’ nature of organisations other than bodies governed by public law." (Zimmermann C-174/11 - the 2/3 funding from social security condition did not apply to officially recognised voluntary welfare associations)
Nature of the recognition conditions that may be imposed: general
- Not sufficient that body authorised to carry on the activity in question
"[55] However, if the national authorities are not to be deprived of the discretion which that provision confers upon them, the recognition of an establishment within the meaning of Article 132(1)(b) of the VAT Directive cannot be equated with the authorisation to carry out certain activities in accordance with national legislation (see, to that effect, judgment of 10 June 2010, CopyGene, C‑262/08, EU:C:2010:328, paragraph 75)." (I GmbH C-228/20)
- Exemptions in Article 132 not inherently limited to public interest activities
"[31] By its second question the referring court is asking, essentially, whether the heading, by itself, of Article 13A of the Sixth Directive, which refers to [e]xemptions for certain activities in the public interest, entails restrictions to the possibilities of exemption provided for by that provision, in particular if the services in question are provided primarily for commercial purposes.
...
[35] According to the United Kingdom Government, the heading of Article 13A of the Sixth Directive indicates that the exemptions provided for by that provision must be restricted to activities in the public interest. Therefore, Article 13A(1)(n) of the Sixth Directive is to be interpreted restrictively, in such a way that only cultural activities carried on in the public interest are exempted and not those carried on solely for profit.
...
[40] The reply to the second question must therefore be that the heading of Article 13A of the Sixth Directive does not, of itself, entail restrictions on the possibilities of exemption provided for by that provision." (Hoffmann C-144/00)
But see
"[50] In that regard, it should be noted, first of all, as regards the context of that provision, that the latter is contained in Chapter 2, headed ‘Exemptions for certain activities in the public interest’, of Title IX of that directive. That exemption thus covers establishments which pursue objectives in the public interest." (I GmbH C-228/20)
- The body is being assessed/recognised (or not) as having the stated attribute (e.g. charitable)
"[91] As stems from the case-law of the Court, when considering whether to recognise bodies other than those governed by public law as being devoted to social wellbeing, it is for the national authorities, in accordance with EU law and subject to review by the national courts, to take various factors into account. These may include the existence of specific provisions, be they national or regional, legislative or administrative, or tax or social security provisions; the public interest nature of the activities of the taxable person concerned; the fact that other taxable persons carrying on the same activities already enjoy similar recognition; and the fact that the costs of the supplies in question may be largely met by health insurance schemes or other social security bodies, in particular when the private operators maintain contractual relations with those bodies (judgment of 15 April 2021, Administration de l’Enregistrement, des Domaines et de la TVA, C‑846/19, EU:C:2021:277, paragraph 70 and the case-law cited)." (Momtrade Ruse C-620/21)
"[38] It is also necessary to take into consideration, for the purpose of assessing the charitable nature of the organisation concerned, the fact that, as is apparent from the order of reference, serviced residences apply prices set under the supervision of the Minister for Economic Affairs." (Les Jardins de Jouvence C-335/14)
"[33] Accordingly, where a taxable person challenges the recognition, or the absence of recognition, of an organisation as ‘charitable’ for the purposes of Article 13A(1)(g) of the Sixth Directive, it is for the national courts to examine whether the competent authorities have observed the limits of the discretion granted by that provision whilst applying the principles of EU law, including, in particular, the principle of equal treatment, which, in the field of VAT, takes the form of the principle of fiscal neutrality (see inter alia, to that effect, Kügler, paragraph 56; Kingscrest Associates and Montecello, paragraphs 52 and 54; and L.u.P., paragraph 48).
...
[52] Accordingly, the principle of fiscal neutrality does not preclude, for example, the situation under Article 13A(1)(g) of the Sixth Directive, whereby, for the purposes of the exemption, it is unnecessary for bodies governed by public law to be recognised as ‘charitable’, but such recognition is required in the case of organisations other than bodies governed by public law.
...
[53] As is apparent from paragraphs 42 and 52 above, in the context of the exemption provided for under Article 13(1)(g) of the Sixth Directive, it is not in relation to bodies governed by public law that the principle of fiscal neutrality requires equal treatment in terms of recognition as ‘charitable’, but in relation to all other organisations, each as compared with the others." (Zimmermann C-174/11)
- Limiting exemption to establishments pursuing activities in line with the purpose of the provision
"[56] It follows that the recognition of an establishment that may be exempted from VAT under Article 132(1)(b) of the VAT Directive allows the Member States, first, to ensure that only establishments which pursue activities in line with the purposes of that provision qualify for such an exemption and, secondly, to make eligibility for that exemption subject to compliance with the conditions laid down in Article 133 of the VAT Directive, and cannot, therefore, be limited solely to the ‘other establishments’ referred to in Article 132(1)(b)." (I GmbH C-228/20)
- Not permitted to single out certain aspects of comparison
"[95] This does not mean, however, that Member States might freely decide which social conditions must be observed by private establishments. Indeed, unlike Article 132(1)(m) of the VAT Directive, Article 132(1)(b) of that directive does not refer to ‘certain’ social conditions as would have been the case had the EU legislature intended to confer a wide discretionary power on the Member States in this matter. On the contrary: the wording used (‘Member States shall exempt …’) implies that the discretion enjoyed in this respect of the Member States is a limited one." (I GmbH C-228/20 AG Hogan)
- Query whether conditions equivalent to those in Article 133 may be imposed as recognition conditions
"[53] Lastly, it should be borne in mind that the first paragraph of Article 133 of the VAT Directive allows Member States to make the granting of the exemption provided for in Article 132(1)(b) of that directive subject to one or more of the conditions set out in that provision. Those conditions relate to the aims of those bodies, their management and the prices charged by them, and concern all the private bodies referred to in Article 132(1)(b).' (I GmbH C-228/20)
"[38] First, the activities which are to be exempted from VAT, those which may be exempted by the Member States and those which may not, as well as the conditions to which the activities eligible for exemption may be made subject by the Member States, are specifically defined by the content of Article 13A of the Sixth Directive. Second, as is confirmed by paragraph 2(a) of that article, which authorises, but does not oblige, the Member States to restrict exemption to bodies other than public-law bodies which do not have a systematic profit-making aim, the commercial nature of an activity does not preclude it from being, in the context of Article 13A of the Sixth Directive, an activity in the public interest.
[39] The possible restrictions on the benefit of the exemptions provided for by Article 13A of the Sixth Directive may be imposed, as is pointed out at paragraphs 28 and 29 of this judgment, only in the context of the application of paragraph 2 of that provision." (Hoffmann C-144/00)
But note that (m) does replicate the not for profit condition
"[33] Although that distinction is not to be found in any of the other language versions of the Sixth Directive, it is borne out by the objective of the provisions contained in Article 13A thereof. As the Advocate General points out in paragraph 57 to 61 of his Opinion, it is not profits (bénéfices), in the sense of surpluses arising at the end of an accounting year, which preclude categorisation of an organisation as non-profit-making, but profit (profit) in the sense of financial advantages for the organisation's members. Consequently, as the Commission also points out, the condition set out in the first indent of Article 13A(2)(a) essentially replicates the criterion of non-profit-making organisation as contained in Article 13A(1)(m)." (Kennemer Golf C-174/00)