Provisional text
ORDER OF THE COURT (Seventh Chamber)
10 April 2024 (*)
(Reference for a preliminary ruling – Article 99 of the Rules of Procedure of the Court of Justice – Questions the answer to which may be clearly deduced from the Court’s existing case-law – Taxation – Value added tax (VAT) – Directive 2006/112/EC – Article183 – Right to deduct input VAT – Rules governing exercise of that right – Late refund – Delay caused by the application of a national provision – Effect of a preliminary ruling given by the Court after those facts occurred – Late payment interest– Limitation – Principles of equivalence, effectiveness and fiscal neutrality)
In Case C‑532/23,
REQUEST for a preliminary ruling under Article 267 TFEU from the Fővárosi Törvényszék (Budapest High Court, Hungary), made by decision of 10 July 2023, received at the Court on 18 August 2023, in the proceedings
Lear Corporation Hungary Autóipari Gyártó Kft.
v
Nemzeti Adó- és Vámhivatal Fellebbviteli Igazgatósága,
THE COURT (Seventh Chamber),
composed of F. Biltgen, President of the Chamber, N. Wahl (Rapporteur) and J. Passer, Judges,
Advocate General: T. Ćapeta,
Registrar: A. Calot Escobar,
having decided, after hearing the Advocate General, to rule by reasoned order, pursuant to Article 99 of the Rules of Procedure of the Court of Justice,
makes the following
Order
1 This request for a preliminary ruling concerns the interpretation of Article 183 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1) and the principles of equivalence, effectiveness and fiscal neutrality.
2 The request has been made in proceedings between Lear Corporation Hungary Autóipari Gyártó Kft. (‘Lear Corporation’) and the Nemzeti Adó- és Vámhivatal Fellebbviteli Igazgatósága (Appeals Directorate of the National Tax and Customs Authority, Hungary) (‘the Appeals Directorate’) concerning the right of Lear Corporation to obtain late payment interest relating to the late refund of excess value added tax (VAT) resulting from a condition laid down by a provision of national law which was subsequently declared incompatible with EU law by the Court.
Legal context
European Union law
3 Article 183 of Directive 2006/112 provides:
‘Where, for a given tax period, the amount of deductions exceeds the amount of VAT due, the Member States may, in accordance with conditions which they shall determine, either make a refund or carry the excess forward to the following period.
However, Member States may refuse to refund or carry forward if the amount of the excess is insignificant.’
Hungarian law
The Law amending the law on VAT
4 The az általános forgalmi adóról szóló 2007. évi CXXVII. törvény jogharmonizációs célú módosításáról és az adó-visszaigénylés különös eljárási szabályairól szóló 2011. évi CXXIII. törvény (Law No CXXIII of 2011 amending, with a view to harmonising the law, Law No CXXVII of 2007 on VAT and laying down detailed rules for the special procedure for the recovery of VAT (Magyar Közlöny 2011/110); ‘the Law amending the law on VAT’) repealed, with effect from 27 September 2011, Paragraph 186(2) to (4) of the az általános forgalmi adóról szóló 2007. évi CXXVII. törvény (Law No CXXVII of 2007 on VAT) (Magyar Közlöny 2007/155), in order to allow the refund of excess deductible VAT without it being necessary to wait for payment of the consideration for the transaction giving rise to the deductible VAT. Previously, Paragraph 186(2) provided that the exercise of the right to a refund of excess deductible VAT was subject to a condition relating to payment of the amount due in respect of the transaction at issue.
5 Under Paragraph 1(1) of the Law amending the law on VAT:
‘Amounts in respect of which the taxable person was not able to claim, in the last VAT return that he or she was required to submit before the entry into force of the present law (“the return”), his or her right to recovery pursuant to Paragraph 186(2) to (4) … repealed by the present law – only for the amount that the taxable person inscribed as tax on unpaid acquisitions – may be the subject of a request for recovery submitted to the tax authority by the taxable person until 20 October 2011, using the form provided for that purpose; irrespective of that period, the taxable person may, in the return corresponding to the scheme to which he or she is subject, count the above amounts as an item reducing the amount of tax for which he or she is liable, or exercise his or her right to a refund in his or her return. That application shall be deemed to be a return for the purposes of the application of the provisions [of the Code of Fiscal Procedure]. The time limit for making this request is a limitation period from which the taxable person cannot be relieved.’
The Code of Fiscal Procedure
6 The az adózás rendjéről szóló 2003. évi XCII. törvény (Law No XCII of 2003 on the Code of Fiscal Procedure) (Magyar Közlöny 2003/131; ‘the Code of Fiscal Procedure’) provides in Paragraph 37(4) and (6):
‘(4) The due date for the payment of a budget subsidy due to the taxable person shall be governed by the annexes to this law or a specific law. The budget subsidy or VAT whose refund is claimed must be paid within 30 days of receipt of the request (return), but not before the due date, this period being extended to 45 days where the amount of recoverable VAT exceeds 500 000 [Hungarian] forint [(HUF)], around EUR 1 300.
…
(6) Where the tax administration makes a late payment, it shall pay interest at a rate equivalent to that of a late payment penalty for each day of delay. …’
7 Paragraph 124/C of the Code of Fiscal Procedure provides:
‘(1) Where the Alkotmánybíróság [(Constitutional Court, Hungary)], the Kúria [(Supreme Court, Hungary)] or the [Court of Justice of the European Union] find, with retroactive effect, that a rule of law prescribing a tax obligation is contrary to the Fundamental Law or to a mandatory act of the European Union or, in the case of a municipal regulation, to any other rule of law, and that this judicial decision gives rise to a right of reimbursement for the taxable person under the provisions of this paragraph, the first-instance tax authority shall proceed with the reimbursement at the taxable person’s request, in accordance with the procedures specified in the decision concerned.
(2) The taxable person may submit his or her request in writing to the tax authority within 180 days of the publication or notification of the decision of the Alkotmánybíróság [(Constitutional Court)], the Kúria [(Supreme Court)] or the [Court of Justice of the European Union]; no request for relief from the foreclosure shall be allowed at the end of the period. The tax authority shall reject the request in the event that, on the date of publication or notification of the decision, the right to claim for compensation has expired.
…
(6) If the taxable person’s right to a refund is well founded, the tax authority shall pay – at the time of refund – interest on the tax to be refunded, at a rate equal to the central bank’s base rate and calculated from the date of payment of the tax until the day on which the decision granting the refund became final. The refund is due on the date on which the decision granting it became final and must be made within 30 days of the date on which it became due. The provisions relating to the payment of budget subsidies shall apply mutatis mutandis to the reimbursement governed by this subparagraph, with the exception of Paragraph 37(6).’
8 Paragraph 124/D(1) to (3) of the Code of Fiscal Procedure is worded as follows:
‘(1) Unless otherwise provided for in this paragraph, the provisions of Paragraph 124/C shall apply to refund applications based on the right to deduct VAT.
(2) The taxable person may exercise the right referred to in subparagraph 1 above by means of a declaration of regularisation – submitted within 180 days of the publication or notification of the decision of the Alkotmánybíróság [(Constitutional Court)], the Kúria [(Supreme Court)] or the [Court of Justice of the European Union] – of the declaration or declarations corresponding to the tax year or tax years in which the right of deduction concerned was created. No request for a statement of foreclosure will be accepted at the end of the period.
(3) If the statement, as rectified in the regularisation declaration, shows that the taxable person is entitled to a refund either because of the reduction in the tax he or she has to pay or because of the increase in the amount recoverable … the tax authority shall apply to the amount to be refunded an interest rate equivalent to the central bank’s base rate, calculated for the period between the date fixed for payment in the declaration or declarations concerned by the regularisation declaration, or the due date – or the date of payment of the tax if this is later – and the date on which the regularisation declaration is submitted. The reimbursement – to which the provisions relating to the payment of budgetary subsidies apply – must be made within 30 days of the date of submission of the regularisation declaration.’
9 Paragraph 164(1) of that code provides:
‘The right to make a tax assessment is time-barred after five years from the last day of the calendar year in which the declaration or notification relating to that tax should have been made or, where there is no declaration or notification, in which the tax should have been paid. Unless otherwise provided by law, the right to request a budget subsidy and the right to reimbursement of overpayments shall lapse five years after the last day of the calendar year in which the right to request the subsidy or reimbursement was opened.’
The dispute in the main proceedings and the questions referred for a preliminary ruling
10 Lear Corporation produces equipment for motor vehicles at several sites located in Hungary. For the VAT return periods from December 2005 to July 2011, it was unable to rely on its right to a refund of VAT because of the existence of the condition then in force and referred to in paragraph 4 above, known as the ‘paid consideration condition’, according to which only purchases paid in full gave rise to a right to deduct input VAT.
11 In the judgment of 28 July 2011, Commission v Hungary (C‑274/10, EU:C:2011:530, paragraph 54), the Court held that Article 183 of Directive 2006/112 did not permit Member States to impose a condition relating to the payment of the amount due for the transaction at issue on the exercise of the right to a refund of a deductible VAT excess.
12 Following that judgment, the Hungarian legislature adopted the Law amending the law on VAT. However, that new law does not contain any rule providing for compensation to taxpayers for the financial damage resulting from the application of the ‘paid consideration condition’, which was held to be incompatible with EU law.
13 On 30 September 2011, Lear Corporation, pursuant to the Law amending the law on VAT, submitted a claim for recovery of VAT relating to the period referred to in paragraph 10 above. The Hungarian tax authority refunded Lear Corporation the amount of VAT claimed, without, however, paying late payment interest.
14 In the order of 17 July 2014, Delphi Hungary Autóalkatrész Gyártó (C‑654/13, not published, EU:C:2014:2127, paragraph 39), the Court held that EU law, and in particular Article 183 of Directive 2006/112, must be interpreted as precluding the legislation and practice of a Member State which exclude the payment of late payment interest on the amount of VAT which was not recoverable within a reasonable period due to a national provision held to be contrary to EU law.
15 In that judgment, the Court stated that, in the absence of relevant EU legislation, it was for that Member State to determine, in compliance with the principles of equivalence and effectiveness, the procedure for the payment of such interest, which must not be less favourable than those applicable to actions based on infringement of national law having a similar purpose and cause of action to those based on the infringement of EU law (principle of equivalence) or be arranged such as to render the exercise of rights conferred by the EU legal order virtually impossible or excessively difficult (principle of effectiveness).
16 On 23 December 2014, referring to the order of 17 July 2014, Delphi Hungary Autóalkatrész Gyártó (C‑654/13, EU:C:2014:2127), Lear Corporation submitted to the Nemzeti Adó- és Vámhivatal Kiemelt Adózók Adóigazgatósága (Tax Directorate for Large-scale Taxpayers of the National Tax and Customs Administration, Hungary) (‘the first-instance tax authority’) a claim for late payment interest in the amount of HUF 457 916 030 (that is, on the date of that request, approximately EUR 1 458 656) for late refund of VAT (‘late payment interest’). It also claimed interest on account of late payment of late payment interest (‘compound interest’) for the period from 1 January 2008 to 31 July 2011.
17 Following the rejection of its application by the first-instance tax authority, Lear Corporation brought the matter before the Appeals Directorate, which, by decision of 12 October 2015, set aside the decision taken by that authority and ordered it to rule on the case afresh.
18 By decision of 10 November 2015, delivered at the end of the review procedure, the first-instance tax authority granted Lear Corporation’s request in part. By a supplementary claim submitted on 2 November 2016, Lear Corporation asked that authority to supplement its decision by awarding it an amount of HUF 122 108 685 (that is, on the date of that additional claim, approximately EUR 396 380), by way of compound interest, claiming the first-instance tax authority should have awarded it the compound interest of its own motion.
19 In a judgment of 24 November 2016, the Kúria (Supreme Court) ruled on the practice followed by the Hungarian tax authority, in order to give due effect to the order of 17 July 2014, Delphi Hungary Autóalkatrész Gyártó (C‑654/13, EU:C:2014:2127). On the basis of that order, it adopted the decision of principle No 18/2017, in which it set out the procedure for calculating late payment interest on the amounts of VAT not recoverable because of the ‘paid consideration condition’, repealed by the Law amending the law on VAT.
20 In the light of that decision of principle, the Appeals Directorate, by decision of 7 March 2017, annulled the decision of 10 November 2015 and ordered the first-instance tax authority to carry out a further examination of Lear Corporation’s claim for late payment interest. By decision of 18 April 2017, that authority granted that request in part, awarding late payment interest in the amount of HUF 225 825 000 (that is to say, on 18 April 2017, approximately EUR 720 585), calculated on the basis of the Hungarian Central Bank base rate, for the period between 1 January 2008 to 31 July 2011.
21 Lear Corporation, not satisfied with that decision, brought an action before the Appeals Directorate, requesting that it also be awarded late payment interest for the period between December 2005 and December 2007, in order to take into account the entire period during which it had not been able to rely on its right to a refund of VAT, in the light of the decision of principle No 18/2017 of the Kúria (Supreme Court).
22 After observing that Lear Corporation had submitted its claim for late payment interest on 23 December 2014, that is to say, within the limitation period imposed under penalty of becoming time-barred, by expressly stating therein the period from 1 January 2008 to 31 July 2011 as the period on which that request was based, the Appeals Directorate considered that, having regard to the principle that the parties have the right to limit the subject matter of an action, the first-instance tax authority was required to rule only on that claim. That directorate therefore took the view that the claim for late payment interest for the period from 1 December 2005 to 31 December 2007 should be examined as a new claim. Consequently, the Appeals Directorate referred the case back to that authority for it to rule on the award of late payment interest sought in that claim.
23 By decision of 1 September 2017, the first-instance tax authority rejected that claim on the ground that it was out of time, given that, by virtue of the decision of principle No 18/2017, the award of late payment interest was expressly subject to a request submitted by a taxpayer who, in view of the limitation period, could be made only until 31 December 2016. That decision was confirmed by the Appeals Directorate on 1 December 2017.
24 Lear Corporation therefore brought an action before the Fővárosi Törvényszék (Budapest High Court, Hungary), claiming that it was also entitled to receive late payment interest corresponding to the period from December 2005 to December 2007 inclusive, on the ground, inter alia, that, by submitting the request referred to in paragraph 13 above in 2011, it had asserted its right to a refund of VAT, which would have been the condition for the grant of interest. It recalled that it had specifically submitted a claim for late payment interest on 23 December 2014, that is to say, within the limitation period, and that, under the decision of principle No 18/2017, the first-instance tax authority should have paid it such interest for the entire period concerned without being bound, in that regard, by the terms of its application, since the principle of effectiveness must prevail over the principle that the parties have the right to limit the subject matter of an action.
25 In those circumstances, the Fővárosi Törvényszék (Budapest High Court) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
‘(1) Must Article 183 of [Directive 2006/112], and also the principles of equivalence and effectiveness, be interpreted as meaning that, when a taxpayer requests a refund of [VAT] which he or she could not request previously due to the application of a regulatory requirement that has been declared, in a judgment of the Court of Justice, to be contrary to EU law, it is appropriate to consider that, in that case, the refund request at the same time constitutes a claim for late payment interest, in view of the incidental nature of the interest and the fact that the claim for late payment interest is governed by the same provision of national law as regulates the request for the refund of the VAT, the late repayment of which has caused the default?
(2) Is a practice of a Member State compatible with the principles of equivalence and effectiveness, and also, especially, with the principle of fiscal neutrality, where, pursuant to that practice, in the context of an administrative procedure relating to tax, relying on the principle that the parties have the right to limit the subject matter of an action (“the dispositive principle”), a subsequent claim by the taxpayer for late payment interest is rejected on the grounds that his or her first claim for late payment interest, which gave rise to the procedure being initiated, did not include the additional period referred to in the subsequent claim, such that the subsequent claim is classified as a new claim and is declared time-barred, even though the tax authority did not consider itself to be bound in any way by the dispositive principle in relation to the taxpayer’s first claim, but rather has invoked that principle exclusively in relation to the late payment interest claimed for a period that, at the time when the claim giving rise to the initiation of the procedure was submitted, was not yet known, that period having been defined by case-law while that procedure was under way?
(3) Having regard to the principles of equivalence, effectiveness and fiscal neutrality[,] should a subsequent claim submitted in the context of an administrative procedure relating to tax, on the basis of the case-law established by the courts, be regarded as constituting a supplement to the first claim, which gave rise to the procedure being initiated, or as a modification of that first claim, where the two claims only differ as regards the interest payment period?
(4) Is a practice of a Member State compatible with the principles of equivalence, effectiveness and fiscal neutrality where, pursuant to that practice, a claim submitted after the expiry of the limitation period is declared time-barred without examining whether admissible circumstances exist which may have suspended or interrupted the limitation period, especially in view of the fact that the first claim was submitted by the applicant in 2014, and also that, even though during the limitation period the current legislation was not amended, given that that legislation only established the requirements for requesting a refund of the VAT, in the absence of relevant rules, the Kúria (Supreme Court …) and the Court of Justice, by means of an extensive interpretation of that legislation, defined in case-law the requirements for claiming late payment interest, such that, during a decisive part of the limitation period of five years, the rules for claiming late payment interest were not only not known by or clear to taxpayers, but rather they did not even exist in the form of legislative provisions?’
The questions referred for a preliminary ruling
26 Under Article 99 of its Rules of Procedure, the Court may at any time, on a proposal from the Judge-Rapporteur and after hearing the Advocate General, decide to rule by reasoned order where the answer to a question referred to the Court for a preliminary ruling may be clearly deduced from existing case-law.
27 It should also be borne in mind that the judicial cooperation established by Article 267 TFEU is based on a clear separation of functions between the national courts and the Court of Justice. First, the Court is not empowered to apply rules of EU law to a particular case, but only to rule on the interpretation of the Treaties and acts of the institutions, bodies, offices or agencies of the European Union (see, to that effect, judgment of 18 May 2021, Asociaţia ‘Forumul Judecătorilor din România’ and Others, C‑83/19, C‑127/19, C‑195/19, C‑291/19, C‑355/19 and C‑397/19, EU:C:2021:393, paragraph 201 and the case-law cited). Second, in accordance with paragraph 11 of the Recommendations of the Court of Justice of the European Union to national courts and tribunals in relation to the initiation of preliminary ruling proceedings (OJ 2019 C 380, p. 1), it is for the national court or tribunal which has referred the matter to the Court of Justice to draw the concrete conclusions, in the proceedings pending before it, from the interpretative information provided by the Court (see, to that effect, judgment of 25 October 2018, Roche Lietuva, C‑413/17, EU:C:2018:865, paragraph 43).
28 In the present case, the Court considers that the interpretation of EU law sought by the referring court may be clearly deduced from the judgments of 12 February 2008, Kempter (C‑2/06, EU:C:2008:78), and of 23 April 2020, Sole-Mizo and Dalmandi Mezőgazdasági (C‑13/18 and C‑126/18, EU:C:2020:292), and from the order of 20 June 2023, SOLE-MiZo (C‑426/22, EU:C:2023:517). It is therefore appropriate to apply Article 99 of the Rules of Procedure in the present case.
29 As is apparent from paragraph 27 above, it will be for the referring court to draw the specific conclusions, in the dispute in the main proceedings, from the interpretative information arising from that case-law of the Court.
The first question
30 By its first question, the referring court asks, in essence, whether Article 183 of Directive 2006/112 must be interpreted, in the light of the principles of equivalence and effectiveness, as meaning that, when a taxpayer requests a refund of VAT which he or she could not request previously due to the application of a regulatory requirement that the Court has held to infringe that article, it precludes that claim for a refund from being regarded as also including a claim for late payment interest, in view of the incidental nature of that interest and the fact that its payment is governed by the same provisions of national law as those applicable to the request for the refund of VAT, the repayment of which was late.
31 In that regard, the Court held, inter alia, in the order of 20 June 2023, SOLE-MiZo (C‑426/22, EU:C:2023:517):
‘40. Where a Member State has levied tax in breach of the rules of EU law, individuals are entitled to reimbursement not only of the tax unduly levied but also of the amounts paid to that State or retained by it which relate directly to that tax. That also includes losses constituted by the unavailability of sums of money as a result of a tax being levied prematurely. Thus, the principle of the obligation of Member States to repay with interest amounts of tax levied in breach of EU law follows from that law …
41. In the absence of EU legislation, it is for the internal legal order of each Member State to lay down the conditions in which such interest must be paid, particularly the rate of that interest and its method of calculation (simple or compound interest). Those conditions must comply with the principles of equivalence and effectiveness; that is to say, they must not be less favourable than those concerning similar claims based on provisions of national law or arranged in such a way as to make the exercise of rights conferred by the EU legal order practically impossible. Those conditions must, in addition, observe the principle of fiscal neutrality …
42. As regards the principle of equivalence, according to the case-law of the Court, compliance with that principle requires that the national rule in question be applied without distinction to actions based on rights which individuals derive from EU law and those based on an infringement of national law having a similar purpose and cause of action …
43. As regards the principle of effectiveness, … that principle requires that the national rules relating to the calculation of interest which may be due in the event of a claim for a refund of excess deductible VAT retained in breach of EU law should not lead to depriving the taxable person of adequate compensation for the loss sustained through the unavailability of the amounts concerned …
44. As regards the principle of fiscal neutrality, it should be noted that, given the purpose of the payment of interest on excess VAT retained by a Member State in breach of the rules of EU law which is intended to compensate the taxable person for the financial loss that he or she incurred owing to the unavailability of the amounts concerned, that principle requires that the detailed rules for paying interest be established in such a way that the economic burden of the amounts of tax unlawfully retained may be offset …’
32 In those circumstances, the answer to the first question is that Article 183 of Directive 2006/112 must be interpreted, in the light of the principles of equivalence, effectiveness and fiscal neutrality, as meaning that, when a taxpayer claims a refund of VAT which he or she could not request previously due to the application of a regulatory requirement that the Court has held to infringe that article, it does not preclude, in the circumstances provided for by the law of the Member State concerned, that claim for a refund from being regarded as also including a claim for late payment interest, having regard to the purpose of the payment of interest on excess VAT retained by a Member State in breach of the rules of EU law, which is intended to compensate the taxpayer for the financial loss that he or she incurred owing to the unavailability of the amounts concerned.
The second question
33 By its second question, the referring court asks, in essence, whether the principles of equivalence, effectiveness and fiscal neutrality must be interpreted as precluding a practice of a Member State which consists of classifying as new, with the consequence that it is time-barred, a claim for late payment interest referring to a period which was not the subject of a first claim for payment of such interest and of excluding any obligation on the part of the tax authority of that State to allocate, on account of the principle that the parties have the right to limit the subject matter of an action, at the stage of that first claim, interest not referred to therein, where the taxpayer was unable, at the date of the first claim, to know that he or she was in a position to extend its temporal scope.
34 At the outset, it should be noted that that question necessarily implies that the possibility referred to in paragraph 32 above does not exist. That question presupposes, by its structure, that the law of the Member State concerned does not contain a provision under which a claim for repayment of the tax unlawfully retained by the tax authority of that State means, ipso jure, that that claim also covers the award of late payment interest.
35 In order to answer the same question, it should first be recalled that the Court, in its judgment of 12 February 2008, Kempter (C‑2/06, EU:C:2008:78), held that:
‘35 … the interpretation which, in the exercise of the jurisdiction conferred upon it by Article [267 TFEU], the Court gives to a rule of [EU] law clarifies and defines, where necessary, the meaning and scope of that rule as it must be, or ought to have been, understood and applied from the time of its coming into force … In other words, a preliminary ruling does not create or alter the law, but is purely declaratory, with the consequence that in principle it takes effect from the date on which the rule interpreted entered into force …
36 It follows that … a rule of [EU] law as thus interpreted must be applied by an administrative body within the sphere of its competence even to legal relationships which arose and were formed before the Court gave its ruling on the request for interpretation …’
36 Next, the Court held, inter alia, in its judgment of 23 April 2020, Sole-Mizo and Dalmandi Mezőgazdasági (C‑13/18 and C‑126/18, EU:C:2020:292), that:
‘49 A national practice, pursuant to which, in the event of reimbursement at the taxable person’s request of an amount of excess deductible VAT retained in breach of EU law, the interest on that amount … runs for a given reporting period, without the application of interest to compensate the taxable person for the monetary erosion caused by the passage of time following that reporting period up until the actual payment of that interest, may deprive the taxable person of adequate compensation for the loss sustained through the unavailability of the amounts concerned and, accordingly, does not observe the principle of effectiveness. Furthermore, such a practice is not such as to offset the economic burden of amounts of tax unlawfully retained, contrary to the principle of fiscal neutrality.
…
64 … where … the claim has arisen as a result of a breach of EU law by a Member State, the principle of effectiveness requires that State to pay default interest in the event of late payment of that claim by the administration, otherwise Member States would have no incentive to compensate for the effects of such a breach on taxable persons without undue delay.
65 As regards the conditions in which such interest is paid, … in the absence of EU legislation, it is for the internal legal order of each Member State to lay down those conditions, provided the latter comply, inter alia, with the principles of equivalence and effectiveness.
…
67 In view of the procedural autonomy enjoyed by the Member States to lay down, in their national law, procedural conditions for the payment of interest on amounts of tax levied in breach of EU law, the requirement concerning the submission by the taxable person of a request for payment of default interest due in the event of delay in payment by the administration of a claim arising as a result of a breach by the State of EU law is not incompatible with the principle of effectiveness.’
37 In the present case, it is apparent from the order for reference that Lear Corporation, first, submitted a claim for late payment interest on 23 December 2014 and, second, that that claim related to a very specific period, namely the period from 1 January 2008 to 31 July 2011. Consequently, in so far as the situation envisaged in answering the first question is not accepted here, namely that the claim for a refund of the principal constitutes in itself, under national law, a claim for late payment interest, the tax authority of the Member State concerned are entitled, under EU law, to adhere to the form of order sought in such a claim, that is to say, in the present case, to interest corresponding to the period defined by the taxpayer himself or herself.
38 However, as stated in the order for reference, it was only after becoming aware of decision of principle No 18/2017 of the Kúria (Supreme Court) that Lear Corporation requested, in the context of the dispute between it and the Hungarian tax authority, that the latter decision be taken into account for the whole of the period determined by that court in the decision concerning the right to late payment interest.
39 In that regard, it must be stated that a practice such as that of the tax authority of the Member State concerned, consisting of regarding such a claim as a new claim, with the result that part of the late payment interest is not refunded because that claim is time-barred, runs counter to the principles clearly established both by the judgment of 12 February 2008, Kempter (C‑2/06, EU:C:2008:78), and by the judgment of 23 April 2020, Sole-Mizo and Dalmandi Mezőgazdasági (C‑13/18 and C‑126/18, EU:C:2020:292).
40 Indeed, first, in the present case, Lear Corporation submitted, within the limitation period, an initial claim for late payment interest relating to the amount of VAT which could not be recovered because of the ‘paid consideration condition’, referring to the order of 17 July 2014, Delphi Hungary Autóalkatrész Gyártó (C‑654/13, EU:C:2014:2127); the subsequent claim submitted by Lear Corporation must be regarded as forming an integral part of the conclusions drawn by the taxpayers, at national level, from that order, which takes effect ex tunc.
41 Second, by actually making it impossible to reimburse the late payment interest relating to the period covered by that subsequent claim, when only a decision of the supreme court of the Member State concerned, subsequent to the initial claim for late payment interest, enabled the taxpayer to be informed of his or her rights in their entirety, the tax authority of the Member State concerned deprive ‘the taxable person of adequate compensation for the loss sustained through the unavailability of the amounts concerned and, accordingly, [do] not observe the principle of effectiveness’ (judgment of 23 April 2020, Sole-Mizo and Dalmandi Mezőgazdasági, C‑13/18 and C‑126/18, EU:C:2020:292, paragraph 49).
42 In those circumstances, the answer to the second question is that the principles of effectiveness and fiscal neutrality must be interpreted as meaning that they (a) do not preclude a practice of a Member State which consists of excluding any obligation on the part of the tax authority of that State to allocate, at the stage of a claim for late payment interest, submitted within the limitation period, relating to amounts of VAT retained by that State in breach of EU law, interest not covered by that claim, but, in contrast, (b) do preclude that authority from classifying as new, with the consequence that it is time-barred, a second claim for late payment interest referring to a period which was not the subject of that first claim, where the second claim concerns late payment interest relating to amounts of VAT retained on account of the same infringement of EU law as that on which the first claim was based and where the possibility of extending the temporal scope of that claim was not known to the taxpayer until after the adoption of a national judicial decision following a decision of the Court delivered in the exercise of the jurisdiction conferred on it by Article 267 TFEU.
The third question
43 By its third question, the referring court asks, in essence, whether the principles of equivalence, effectiveness and fiscal neutrality must be interpreted as allowing a second claim for late payment interest, submitted due to a development in the case-law, to be regarded as constituting a supplement to a first claim for payment of such interest, or as an amendment to that first claim, in view of the fact that the two claims only differ from the point of view of the period in respect of which late payment interest is claimed.
44 In view of the answer given to the second question in paragraph 42 above, according to which those principles preclude, in such a case, the tax authority of the Member State concerned from classifying the second claim for late payment interest as a new claim, it must logically be inferred that those principles imply, on the contrary, that the latter should be classified in accordance with the procedure which it is for that State to determine in the light of its national law, as a supplement to the first claim for payment of such interest.
45 In those circumstances, the answer to the third question is that the principles of effectiveness and fiscal neutrality must be interpreted as meaning that they imply that, in accordance with the procedure which it is for each Member State to determine in the light of its national law, a second claim for late payment interest referring to a period which was not the subject of a first claim for payment of such interest must be regarded as supplementing that first claim (a) where that second claim concerns late payment interest relating to amounts of VAT retained on account of the same infringement of EU law as that on which the first claim was based and (b) where the possibility of extending the temporal scope of that first claim was known to the taxpayer only after the adoption of a national judicial decision following a decision of the Court delivered in the exercise of the jurisdiction conferred on it by Article 267 TFEU.
The fourth question
46 The fourth question referred by the national court is based on the premiss that the second claim for late payment interest may be time-barred in circumstances such as those of the dispute in the main proceedings. It follows from the answer to the second question, set out in paragraph 42 above, that the principles of equivalence, effectiveness and fiscal neutrality preclude such a claim from being classified as a new claim and, consequently, from being time-barred. On the contrary, it follows from the answer given to the third question in paragraph 45 above that that claim must be regarded, in accordance with the procedures which it is for each Member State to determine in the light of its national law, as a supplement to the first claim for late payment interest.
47 It is therefore unnecessary to reply to the fourth question.
Costs
48 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court.
On those grounds, the Court (Seventh Chamber) hereby rules:
1. Article 183 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax
must be interpreted, in the light of the principles of equivalence, effectiveness and fiscal neutrality, as meaning that when a taxpayer person claims a refund of value added tax (VAT) which he or she could not request previously due to the application of a regulatory requirement that the Court has held to infringe that article, it does not preclude, in the circumstances provided for by the law of the Member State concerned, that claim for a refund from being regarded as also including a claim for late payment interest, having regard to the purpose of the payment of interest on excess VAT retained by a Member State in breach of the rules of EU law, which is intended to compensate the taxpayer for the financial loss that he or she incurred owing to the unavailability of the amounts concerned.
2. The principles of effectiveness and fiscal neutrality
must be interpreted as meaning that they (a) do not preclude a practice of a Member State which consists of excluding any obligation on the part of the tax authority of that State to allocate, at the stage of a claim for late payment interest, submitted within the limitation period, relating to amounts of VAT retained by that State in breach of EU law, interest not covered by that claim, but, in contrast, (b) do preclude that authority from classifying as new, with the consequence that it is time-barred, a second claim for late payment interest referring to a period which was not the subject of that first claim, where the second claim concerns late payment interest relating to amounts of VAT retained on account of the same infringement of EU law as that on which the first claim was based and where the possibility of extending the temporal scope of that claim was not known to the taxpayer until after the adoption of a national judicial decision following a decision of the Court delivered in the exercise of the jurisdiction conferred on it by Article 267 TFEU.
3. The principles of effectiveness and fiscal neutrality
must be interpreted as meaning that they imply that, in accordance with the procedure which it is for each Member State to determine in the light of its national law, a second claim for late payment interest referring to a period which was not the subject of a first claim for payment of such interest must be regarded as supplementing that first claim (a) where that second claim concerns late payment interest relating to amounts of VAT retained on account of the same infringement of EU law as that on which the first claim was based and (b) where the possibility of extending the temporal scope of that first claim was known to the taxpayer only after the adoption of a national judicial decision following a decision of the Court delivered in the exercise of the jurisdiction conferred on it by Article 267 TFEU.
[Signatures]