Weekly VAT News

We are pleased to invite you to the next Indirect Tax Perspectives event on Thursday, 18 June. The event will be held in person and will take place at our London Office at 1 More London Place, London, SE1 2AF.

The session will run from 9:45 to 11:15, with networking and refreshments available from 8:45.

Our agenda will include:

• A round-up of the latest indirect tax topical issues including recent HMRC activity
• Key themes from our Global Indirect Tax Symposium – from fast moving AI development and what it means for your business, to unlocking value in data, tax authority audit activity and key technical topics
• Data-driven tax – getting it right first time and data readiness planning for UK e-invoicing
• UK CBAM countdown to 1 January 2027 – a practical overview of the regime and what it means for your business

We hope you will be able to join us and look forward to hosting you. If you would like to forward this invite to your colleagues, please feel free to do so.

Please register for this event here.

For further information please contact Sarah Delaney.

The quarterly EY UK Economic Outlook brings together macroeconomic analysis and sector trends, alongside clear scenarios (upside as well as downside) and implications for business.

The May 2026 edition spotlights renewed disruption to the UK’s energy supply. With consumer-facing and industrial sectors the most exposed, it explores the underlying business drivers and implications for these sectors in particular.

The US Department of Commerce has published a Federal Register notice that establishes procedures for pharmaceutical companies to apply for company-specific agreements that may reduce Section 232 tariffs.

Approved companies may qualify for a reduced duty rate of 20%, or 0% through 20 January 2029 if additional conditions, including a US Department of Health and Human Services agreement, are met.

Applications must be submitted by 12 June 2026 and require detailed investment, production and compliance commitments.

Please refer to our Global Tax Alert for further details.

For further information please contact Marc Bunch or Ross Freeman.

Topics – Valuation and minimum profit margin

C-603/24 Stellantis Portugal

On 13 May 2026 the Court of Justice of the European Union (CJEU) released its decision in this Portuguese referral which asks whether Article 2 of the Sixth VAT Directive should be interpreted as meaning that the concept of the supply of services includes an adjustment of the sale price of vehicles which is duly provided for and determined in a contract concluded between the parties, in order to achieve an agreed minimum profit margin, and which is documented by means of a credit or debit note issued to the applicant/appellant by the European manufacturers of the General Motors Group. The CJEU treated this as a question of whether the TP adjustment was consideration for a supply of services separate from the purchase of the vehicles by the appellant.

The appellant, formerly General Motors Portugal, Lda. (GMP), is a company operating in the motor vehicle trade as part of an economic group engaged in the manufacture and distribution of vehicles (SUPs) and parts and accessories (P&A).

The group is made up of companies performing the following functions:

• The original equipment manufacturers (OEMs), which manufacture the products and/or supply them to the national sales companies or national sales organisations (NSCs/NSOs)
• The NSCs/NSOs, which distribute those products in a market that has been predefined in geographical terms

In the production chain, the appellant operates as an NSC/NSO, purchasing vehicles from the European manufacturers (OEMs) of the General Motors group. The vehicles purchased are resold to independent Portuguese dealers, which, in turn, sell those vehicles to the final customers.

In the event of manufacturing defects, the final customer goes to the dealer to have them repaired, by the dealer, in its own facilities. The cost of these repairs (plus VAT) is charged by the Portuguese dealers to the appellant.

The appellant informs the OEMs of the General Motors group of the costs incurred in distributing the motor vehicles and the parts and accessories manufactured by the group. Those costs include the vehicle repair costs and the appellant’s operating costs, in particular staff, electricity and marketing costs.

An adjustment is periodically made to the price of the vehicles sold to the appellant by the European manufacturers of the General Motors group. Under the contractual terms of this arrangement, the NSCs are guaranteed a predetermined profit margin in accordance with the transfer pricing position of the General Motors Group, taking into account costs of sale including the costs of repair services as set out above.

In accordance with the procedure followed by GME, the initial transfer price is determined in each reference period applying a pre-determined gross margin discount to the expected external sale price. At the end of each reference period, the contractual terms provide that the initial transfer price is adjusted to ensure that the actual financial results of the OEM tally with the agreed operating profit. That adjustment is made with the relevant increase or reduction being recorded in the accounts of the selling unit (OEM) and is documented by means of a credit or debit note issued to the appellant by the relevant OEM.

During a tax audit, the Portuguese tax authorities concluded that the price adjustments included remuneration for the provision of repair services to the OEMs. These services took place in Portugal and should therefore be subject to Portuguese VAT and documented by invoices.

On appeal, the Supreme Administrative Court referred the case to the CJEU, asking whether an adjustment to the sales price of vehicles, which is aimed at achieving a minimum margin and is duly established and specified in a contract between the parties, should be considered a supply of services for VAT purposes.

The CJEU held that the only legal relationship between GMP and the OEMs was the 2004 agreement. The object of that agreement was to fix the transfer prices of the vehicles sold by those OEMs to GMP and that the adjustments to those prices were intended to ensure that GMP obtained a profit margin determined in advance. The CJEU found that none of the clauses indicated that there was a legal relationship between GMP and the OEMs according to which GMP was under an obligation to undertake, for remuneration, the repair of the vehicles which it purchased from those OEMs. Moreover, the Court considered there were no unwritten facts which supported the existence of such a legal relationship.

The Court further held that the uncertain nature of the existence of remuneration is enough to break the direct link between the service provided and the remuneration received (Arcomet Towercranes). Thus, in order for such a link to be established, remuneration must not be gratuitous, random or difficult to quantify.

The adjustments in this case were calculated by taking into account not only the costs relating to the repairs carried out by the independent dealers and invoiced by them to GMP, but also the operating costs. Thus, the costs appear to be only one of the parameters taken into account for the purposes of calculating those adjustments. Further, those adjustments could give rise not only to credit notes, but also to debit notes, i.e. a payment in either direction. In addition, the various costs incurred by GMP in the distribution of those vehicles were taken into account only in order to ensure that the profit margin previously determined was met, with the result that, once that margin had been achieved, GMP was not reimbursed by the OEMs for all those costs, in particular the vehicle repair costs.

On that basis, the CJEU held that the link between any repair services for the vehicles provided by GMP to the OEMs and the adjustments to the transfer prices of those vehicles is, at most, indirect and therefore the payment could not be consideration for a supply of repairs. As regards the Portuguese Government's argument that, by bearing the costs of repairing those vehicles, GMP acted on behalf of the OEMs concerned and intermediated itself in a supply of services provided by the dealers to those OEMs, the Court held that there was no evidence that GMP was involved in such a supply of services nor that it acted on behalf of others.

In conclusion, the CJEU held that the transfer pricing adjustments agreed within a group to ensure a target profit margin, implemented via credit/debit notes, and calculated using costs including vehicle repairs, do not constitute consideration for a supply of services.

The CJEU considered that this was the case unless there is a legal relationship between those companies characterised by reciprocal arrangements for the supply by the acquiring company of services to the selling company and the payment, in the form of an adjustment, has a direct link with the provision of these services.

Comments: The VAT consequences of transfer pricing adjustments are highly topical with a number of cases seen before the Court recently. The facts are very different in this case to that of Arcomet where the transfer pricing adjustment was the whole consideration and could have gone in either direction. In this case, there was a sale of a car for a price which can only be finally determined at the end of the year. However, it appeared that there would always be a price paid for the car so that the issue of “negative consideration” would not arise. Whilst the express judgment of the CJEU is limited to the TP adjustments not constituting or including consideration for repair services, there is no express finding that they are adjustments to the initial purchase price of the car by Stellantis, although that is the clear implication of the judgment.

Once again, the CJEU has stuck close to the specific question asked and not provided a definitive statement as to what the adjustments are, rather than what they are not. However, reading between the lines, it appears clear that the CJEU did see the adjustments (evidenced by credit and debit notes) as changes in consideration for the purchase of the vehicles.

One further issue demonstrated by the judgment is that the arm’s length value required by transfer pricing may differ from an open market value charged to third parties (because the arm’s length value can be subject to a number of adjustments based on the circumstances of the purchaser). Article 80 permits Member States to adjust consideration to the “open market value” where there is a partial exemption impact. Whilst it would be unexpected for such an adjustment to be made where an arm’s length value has been applied using transfer pricing adjustments, the arm’s length price may be materially lower than the open market price where, for example, the purchaser is guaranteed a fixed profit margin but has high start-up costs.

The impact of transfer pricing on VAT issues is undoubtedly significant and is likely to continue to raise questions of interpretation. Any business processing such adjustments should carefully review its arrangements (VAT treatment, contracts, systems and invoicing) together with recent litigation in this area to ensure any risks are managed as well as making sure that the VAT team has sight of any TP adjustments that are made.

Please also refer to our Global Tax Alert.

For further information, please contact Mitchell Moss or Simon Harris.

Topics – Supply of goods – asset transfer to non-taxable individuals

T-366/25 – Szytelbiecka

On 13 May 2026 the General Court of the European Union (GCEU) delivered the opinion of Advocate General Martín y Pérez de Nanclares (AG) in this Polish referral which asks whether Article 19 of the VAT Directive must be interpreted as meaning that a transfer of a totality of assets within the meaning of that provision also occurs when there is a transfer without consideration by a taxable person of a half share each of a totality of assets to two individuals who are not taxable persons and who intend to contribute those shares immediately as a contribution in kind to a business partnership of which they are partners.

The applicant is a taxable person who, together with her husband, intends to transfer a business (transfer of a going concern) to two daughters (AK and PK) who are non-taxable individuals. Each daughter is to receive a half share of the business. Thereafter, the applicant will no longer own any assets that were part of the business at the time of the transfer. Immediately after making the transfer, the applicant will terminate her business activity.

AK and PK run a separate undertaking (the partnership), and they plan to incorporate the transferred business into this undertaking and continue it in an essentially unchanged form. The partnership is and will remain a taxable person for the purposes of VAT.

The applicant applied for an advance tax ruling on whether the transfer to AK and PK would be outside the scope of VAT as a ‘transfer of a going concern’ pursuant to Article 19. This provision provides that ‘in the event of a transfer, whether for consideration or not or as a contribution to a company, of a totality of assets or part thereof, Member States may consider that no supply of goods has taken place and that the person to whom the goods are transferred is to be treated as the successor to the transferor.’

The tax authority concluded that the transfer fails to qualify as a transfer of a going concern within the VAT provisions. In the case of fractional co-ownership, each co-owner has a fractional share in the asset. At the same time, a co-owner is the sole owner with respect to his or her share. Each co-owner may therefore dispose of his or her share without the consent of the other co-owners. The co-owners are therefore separate legal entities.

National legislation regarding an ‘exempt’ disposal only applies in the event of the disposal of an undertaking or an organised part thereof. The tax authority considered that AK and PK only receive a part of the undertaking (a fraction thereof), and not the entire undertaking (as no joint ownership will be created). In the immediate case, the transfer does not involve the undertaking as a whole, but rather a share in its individual assets. This is because a share is not a separate, independent item; it represents a fractional ownership right in each asset of the undertaking. Such a fraction, taken in isolation, cannot independently support economic activity.

A disposal of an undertaking occurs only when all its assets are transferred to a recipient who continues the transferor’s business. In this case, the applicant intends to transfer assets that will not themselves be used to carry out specific economic functions. Instead, these assets will be used for business purposes by a third party, a general partnership established by AK and PK. They also plan to transfer their received shares into the partnership. Consequently, the business will not be continued by the immediate transferees of the shares, but by a separate legal entity, the general partnership.

On appeal, the Supreme Administrative Court referred questions to the GCEU regarding whether a transfer of assets to non-entrepreneurs (AK and PK), who would subsequently contribute those assets to a partnership, constitutes a transfer of a going concern pursuant to Article 19.

The AG recalled that in the immediate proceedings, the applicant’s assets are transferred to several persons; it is therefore necessary to consider the concept of ‘person to whom the goods are transferred’ in the first paragraph of Article 19 and whether, under that provision, a totality of assets may be transferred to several such persons.

The AG considered the key issue to be how to interpret the phrase that ‘the person to whom the goods are transferred is to be treated as the successor to the transferor’.

Pursuant to established EU law, the AG recalled that interpretation of the provision requires consideration of both its wording and also its context and purpose. Case law supports that the phrase refers to the person who acquires all or part of a business’s assets in a way that allows an independent economic activity to continue, and who intends to carry on that activity.

While a business’s assets can be transferred in parts, potentially to multiple parties, the legislation uses the singular term ‘person to whom the goods are transferred’. Therefore, the provision should be understood to mean that any given transfer – whether of all or part of the assets – can only be made to a single recipient for the purposes of these provisions.

The AG considered that such an interpretation aligns with both the wording and the broader legal context, which consistently refers to one transferor and one transferee.

The purpose of Article 19 also supports this view; it ensures continuity of VAT treatment by requiring the recipient to assume the transferor’s VAT rights and obligations, including any adjustments. This reflects the principle that a transfer of a business should not disrupt the VAT system.

Accordingly, the AG opined that a transfer of assets, in whole or in part, must be treated as involving a single recipient. The first paragraph of Article 19 must be interpreted as excluding from its scope the transfer by a taxable person of a totality of assets in equal shares to two non-taxable persons.

The AG also noted that while a separate analysis of each transaction may follow the legal rule, it does raise the question as to whether looking at them together better reflects their ‘economic reality’. It could be argued that the transfer should be viewed as a whole, since its overall aim is to continue the business through a partnership formed by AK and PK. This broader view supports the objective of VAT law, which is to allow business transfers without disrupting taxation.

However, the AG opined that the transfer in the immediate proceedings fails to qualify as a ‘single transaction’, this can only apply where steps are inseparable or where one element is clearly dominant and others are ancillary. In this case different parties are involved, each transaction stands alone and has its own purpose and the link between them is mainly the parties’ ‘intention’, which is not sufficiently supported by objective evidence.

The AG considered that the provisions should ultimately apply to the final recipient, ensuring there is only one beneficiary and preventing tax avoidance.

The AG accepted that it might be attractive to allow a ‘joint’ analysis of the transactions at issue, however he concluded that an interpretation based on a separate examination of the transactions is necessary. Such a view is consistent not only with the principles relating to VAT but also with the objective pursued by Article 19, which is to facilitate the transfer of a business and not tax schemes.

In conclusion, the AG opined that Article 19 must be interpreted as meaning that a transfer of a totality of assets does not occur when there is a transfer without consideration by a taxable person of a 50% share to two individuals who are not taxable persons and who intend to contribute those shares immediately as a contribution in kind to a business partnership in which they are partners.

Comments: Businesses should carefully assess how they structure any transfers of a business or its assets where VAT relief under Article 19 is expected. Splitting a business between multiple recipients – even if they later combine the assets in a partnership – may fall outside the rules, triggering unexpected VAT costs. Businesses should also ensure that transactions reflect economic substance, not just intended outcomes, and cannot rely on grouping separate steps unless they genuinely form a single, inseparable transaction. Where intermediate transfers are involved, focus should be on the final recipient and whether they meet the conditions. Overall, careful planning is needed to avoid structures that could be viewed as fragmented or artificial, and to prevent challenges from the tax authorities.

Whilst this Opinion might be seen as a form over substance, contrary to the position of the Court in other areas such as input tax recovery, if followed, it should not lead to too many practical problems. With the benefit of hindsight, the transferors in this case (the parents) should have transferred the assets directly to their daughters’ partnership if they wanted TOGC treatment. As the AG says at paragraph 92, “That decision [to transfer separately to the 2 daughters] has tax consequences for the applicant, her daughters and their partnership which they cannot attempt to circumvent by seeking to have clearly defined transactions treated the same way as another type of transaction which they preferred not to carry out for reasons which, I hasten to add, are their own”.

Wednesday 3 June

Judgment – T-198/25 – G Kft. (Régularisation de la TVA après un contrôle fiscal)

Topics – Correction and refunding of VAT improperly invoiced – closed period

A Hungarian referral which asks whether Articles 167, 168, 179, 180, 183, 250 and 252 of the VAT Directive, together with the principles of tax neutrality, effectiveness and proportionality, must be interpreted as permitting domestic legislation to the effect that, in relation to a period closed by means of an inspection, the correction and refunding of VAT improperly invoiced is only possible if there are new facts and circumstances that demonstrate that the taxable person did not previously have, nor could in good faith have had at its disposal, or of which the taxable person was not, nor could in good faith have been aware, even if there was no risk of any loss of tax revenue.

Wednesday 10 June

Judgment – T-444/25 – Cavert

Topics – VAT grouping eligibility – exempt medical care

A Dutch referral concerning a VAT group comprised of five entities, including two foundations and three private limited companies, providing various care services for individuals with intellectual disabilities. Only one foundation is officially recognised as a care institution, exempting its services from VAT. The referral asks whether Article 11 of the VAT Directive, read in conjunction with Article 132(1)(b) and (g), must be interpreted as meaning that the exemptions referred to therein apply only in so far as the supplies of the VAT group referred to in those provisions are made to third parties for consideration by a legally independent member of the VAT group which, considered individually, meets all the conditions for the application of those exemptions. If answered in the negative, is it sufficient for the applicability of Article 132(1)(b) and (g) and Article 133 in respect of all supplies referred to in those provisions made by the VAT group to third parties for consideration that only one legally independent member of the VAT group satisfies all the conditions for the application of those exemption provisions.

Thursday 11 June

Opinion – C-308/25 – Isolanti Group

Topics – Simplified resolution mechanism – exclusion of disputes involving VAT on imports but not the resolution for intra-Community VAT disputes

An Italian referral which asks whether Article 4(3) of the Treaty on European Union and Articles 250 and 273 of the VAT Directive preclude national legislation which provides for a simplified resolution mechanism, which excludes disputes involving VAT on imports but allows resolution for intra-Community VAT disputes. The referring court questions whether the simplified resolution mechanism violates EU obligations to ensure full VAT collection and equal treatment of taxpayers.

This Brief provides an update on the VAT treatment of supplying electricity at electric vehicle charge points in public locations, following the First-tier Tribunal (FTT) decision in Charge My Street Limited (CMS).

Supplies of fuel and power to domestic premises are subject to the reduced rate of VAT at 5%. HMRC’s long-standing policy is that electric vehicle charge points located in public areas do not qualify as domestic premises and the standard rate of VAT applies to the supply of electricity at these locations.

The FTT found in favour of CMS. It concluded that Note 5(g), Item 1, Group 1, Schedule 7A, VATA94 covers supplies of electricity to an identified person at any identifiable premises, provided the total supplied does not exceed 1,000 kWh in a calendar month. The FTT clarified that there is no additional requirement for the premises to be owned or controlled by the person receiving the supply, nor do the premises need to be buildings. This means locations such as public car parks may be included.

HMRC has applied for permission to appeal the FTT decision to the Upper Tribunal and its policy remains that charging electric vehicles at public charge points is subject to VAT at the standard rate.

Comments: We consider that given the fact pattern, the FTT decision should apply to most if not all EV charging providers in the UK. Any who have not already submitted claims, may wish to do so. For businesses operating workplace charging, opportunities to make claims may also exist.

HMRC is likely to have appealed in order to secure a binding higher court judgment with wider industry applicability, and due to concern that the imprecise definition of “premises” could materially affect the broader application of the de minimis test to electricity supplies made by utilities.

CMS may potentially cross-appeal the point they lost on, namely who is the supplier of the EV charging (the App provider or the Charge Point Operator).

For further information, please contact Richard Norman or Mitchell Moss.

Plastic Packaging Tax (PPT) was introduced on 1 April 2022, with the aim of providing an economic incentive for businesses to use recycled plastic in plastic packaging manufactured in or imported into the UK. By increasing the demand for recycled material, the tax is intended to stimulate higher recycling rates and divert more plastic waste away from landfill or incineration.

At Autumn Budget 2024, the Government announced that, to support use of and investment in advanced chemical recycling technologies, businesses will be permitted to use a mass balance approach (MBA) to account for chemically recycled plastic used to make plastic packaging for the purposes of PPT. The majority of responses from a previous PPT consultation agreed that it was necessary to accompany this change with a mandatory certification requirement for chemically recycled plastic as a means to prevent fraud and maintain consumer confidence. As announced at Budget 2025, an MBA will be permitted for use by businesses from 1 April 2027.

Following representations from industry, the Government has now published a Consultation which explores the risks and industry concerns around recycled plastic content claims and the potential introduction of a mandatory certification requirement for plastic packaging containing mechanically recycled plastic. It seeks views on possible changes to the evidential requirements, the scale and nature of fraudulent claims, the potential impacts on businesses, how a certification requirement could operate and possible timings for implementation.

The period of consultation closes on 10 August.

For further information please contact Thomas Pegler.

This Guidance provides details regarding the Advance Tax Certainty Service. The aim of the service is to deliver a stable and transparent tax environment by reducing tax uncertainty for major UK investment projects. To apply, a project must have at least £1 billion of qualifying expenditure in the UK over its lifetime.

The new service, which launches on 1 July 2026 and with expressions of interest accepted from 1 June, will provide businesses with a binding clearance on how the tax rules will apply to a major investment project from before the final investment decision is taken up until the relevant tax return is made.

Under this service, the clearance can cover uncertainties relating to the following UK taxes:

• Corporation Tax
• VAT
• Stamp Duty Land Tax
• Income Tax
  • PAYE regulations
  • Construction Industry Scheme

The service will not cover transfer pricing, but where appropriate the existing Advance Pricing Agreement programme is available.

Please also refer to:

• Advance tax certainty service: draft guidance
• Advance tax certainty for major projects consultation
• Finance Act 2026

From 18 May 2026, HMRC is introducing mandatory registration for tax advisers who are paid to interact with HMRC on behalf of clients. These resources provide further details. A press release is available here.

Online registration will roll out in stages between 18 May 2026 and 31 March 2027.

This Guidance explains how to apply for an agent services account to register with HMRC as a tax adviser and use certain HMRC services. It has been updated to reflect the legal requirement for tax advisers who interact with HMRC on behalf of clients to register for an agent services account.

Please also refer to:

• Check if and when you need to register as a tax adviser with HMRC – Updated with information to tell businesses how to register with HMRC as a tax adviser through the new online registration process introduced on 18 May 2026
• Check if you meet HMRC's conditions to register as a tax adviser – Updated with information for both UK-based and overseas businesses regarding how to register with HMRC as a tax adviser

This Notice explains the VAT rules for food processing and abattoir services. Sections 5 and 6 have been updated to explain how Agriculture and Horticulture Development Board levies are treated in respect of VAT.

This Notice provides details regarding administrative agreements relating to VAT on certain specific transactions between members of trade bodies and HMRC. Section 22 (Agreement with the Meat and Livestock Commission) has been updated to explain how certain levies are treated in respect of VAT.

Kenya

The National Treasury Cabinet Secretary has presented the Finance Bill, 2026 to Parliament for consideration and public input. The Bill proposes several business tax changes which, from an indirect tax point of view includes:

• Exclusion of financial charges from the value of a taxable supply under hire purchase (HP) transactions in which the supplier of goods is licensed and the HP agreement is registered under the Hire Purchase Act. The implication is that for businesses conducting unlicensed/unregistered HP transactions, any financial charges will be regarded as consideration (taxable value) of the supply of the goods and therefore subject to VAT
• Introduction of a new requirement for registered persons to make an input tax adjustment if taxable supplies subsequently become exempt while still unsold. In such circumstances, any input VAT previously deducted in relation to those unsold supplies must be accounted for in the VAT return for the period in which the supplies became exempt
• Currently, taxpayers can apply for VAT on bad debts if the invoices remain unpaid for two years from the date of the supply. The Bill seeks to amend the period from two years to three years from the date of the supply. This indicates that businesses will have to wait longer before applying for refunds of VAT paid on bad debts
• Broaden the requirement to issue a tax invoice to include all persons and to restrict the issuance of invoices purporting to show VAT for taxable supplies only
• Alignment with the Tax Procedures Act on tax avoidance schemes
• Increase for tax-free allowance on baggage for returning travellers
• Clarification on VAT treatment of financial services provided over a digital platform/by payment service provider. The Bill proposes to exclude, as exempt financial services, certain services (i.e., money transfers, payment processing, settlement, merchants acquiring, gateway or aggregation services) supplied through software or over a platform by a payment service provider for a fee or commission. This implies that fees/commissions charged on financial services provided/supplied over a digital platform by a payment service provider are subject to VAT at the standard rate
• Clarification on exemption of services of tour operators by introducing the definition of "tour operator" and "inhouse supplies"
• Various amendments to the VAT status of defined supplies (please refer to our alert for further details)
• Various amendments to the Excise Duty Act (please refer to our alert for further details)

Canada

The Revenue Agency (CRA) has verbally informed various industry groups that it intends to grant a material extension to the implementation deadline for applying goods-and-services tax/harmonized sales tax (GST/HST) to mutual fund trailing commissions. The CRA also stated that it will provide further details with respect to the enforcement of its administrative position in a notice that will be published by the end of the month.

The CRA had previously indicated in a recent GST/HST interpretation and a related information notice that GST/HST would apply to trailing commissions effective 1 July 2026 (for more information, see EY Global Tax Alert, Canada Revenue Agency reverses longstanding position on GST/HST status of trailing commissions, dated 14 January 2026).

Australia

The Government has announced its 2026-27 Federal Budget. Indirect tax measures include the reduction of the fuel excise rates relating to most fuel products by 50%, commencing 1 April 2026 for a period of three months. This equates to 32 cents per litre for petrol and diesel. The road user charge for heavy vehicles has also been reduced from 32.4 cents per litre to zero.

The European Commission has published a synopsis report on Calls for Evidence on the implementing act on the carbon price paid in third countries for the definitive phase of the Carbon Border Adjustment Mechanism (CBAM).

On 28 August 2025, the European Commission launched three Calls for Evidence to support the preparation of the implementing acts for the definitive phase of the CBAM. This specific consultation aimed to gather stakeholder input on technical and administrative aspects of converting foreign carbon costs into a reduction of the CBAM liability, including proof of payment, currency conversion, and eligibility of third-party certifiers.

For further information please contact Mark Feldman, Laura Mariga or Penelope Isbecque.