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TMI Blog1999 (9) TMI 943X X X X Extracts X X X X X X X X Extracts X X X X ..... C) two questions on the interpretation of Article 13A(1)(b) and (g) of the Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes - Common system of value added tax: uniform basis of assessment (OJ 1977 L 145, p. 1, 'the Sixth Directive'). 2. The questions were raised in proceedings between Mr and Mrs Gregg and the Commissioners of Customs Excise ('the Commissioners'), who are responsible for collecting value added tax ('VAT') in the United Kingdom, concerning application of a VAT exemption provided for in Schedule 9, Group 7, item 4, of the Value Added Tax Act 1994 ('the VAT Act 1994'), transposing Article 13A(1)(b) and (g) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment or diagnosis and other duly recognised establishments of a similar nature; ... (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 organisations recognised as charitable by the Member State concerned.' The dispute in the main proceedings and questions referred to the Court 5. Mr and Mrs Gregg, who are in business as a partnership under the law of Northern Ireland, run a nursing home there called the 'Glenview Nursing Home', comprising 17 bedrooms and communal areas. The business employs about 25 persons. It is registered as both a 'residential care home' and a 'nursi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... '1. Is Article 13A(1) of the Sixth Directive to be interpreted as meaning that two natural persons (i.e. individuals) who carry on business in common as partners cannot claim exemption under subparagraph (b) in the circumstances summarised in the schedule to these questions and on the assumptions that (a) the business consists of medical care and closely related activities and (b) they are duly recognised and their activities are of a similar nature to those provided by hospitals and/or centres for medical treatment or diagnosis ? In particular, are the partners excluded from exemption because - they do not constitute a body governed by public law; - their activities are not undertaken under social condi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tural persons. 11. The United Kingdom, German and Netherlands Governments and the Commission contend that neither the literal meaning of the terms 'establishment' or 'organisation' nor the strict interpretation that must be given to the exemptions referred to in Article 13 of the Sixth Directive can have as a necessary consequence that the legal form in which the taxable person concerned carries on his business constitutes a determining factor in deciding whether or not the activities carried on by him are taxable. The principle of fiscal neutrality would preclude confining the exemption to legal persons. 12. It should be observed at the outset that, according to settled case-law of the Court, the terms used to describ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al persons where it refers expressly to activities undertaken by 'establishments' or 'organisations', whilst in other cases an exemption may also be claimed by natural persons. 16. That interpretation is not affected by the fact that, as the Court held in Bulthuis-Griffioen, cited (supra) above, at paragraphs 18 and 19, the specific conditions concerning the status or identity of the economic operator performing the services covered by the exemption are to be interpreted strictly. 17. The terms 'establishment' and 'organisation' are in principle sufficiently broad to include natural persons as well. It may be added that none of the language versions of Article 13A of the Sixth Directive include the term ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons referred to in Article 13A(1)(b) and (g) was dependent on the legal form in which the taxable person carried on his activity. 21. The answer to the questions must therefore be that Article 13A(1) of the Sixth Directive is to be interpreted as meaning that the terms 'other duly recognised establishments of a similar nature' and 'other organisations recognised as charitable by the Member State concerned', which appear in subparagraphs (b) and (g) of that provision respectively, do not exclude from that exemption natural persons running a business. Decision on costs Costs 22. The costs incurred by the United Kingdom, German and Netherlands Governments and by the Commission, which have submitted observations t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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