An economic activity of a commune and tax on goods and services

Abstract

The commune is the basic unit of local government, implementing public tasks of various nature. In terms of non-authoritarian tasks, the commune manages its own assets and provides public services to residents. The commune’s activities are not economic activities under the Entrepreneurs’ Law. However, it may be a business activity under the Goods and Services Tax Act. This Act provides for the exclusion from VAT of commune activities undertaken by it as a public authority, while activities undertaken as a VAT payer are subject to this tax. The aim of the article is to examine, in the light or Article 15 of the Act on Tax on Goods and Services, Article 13 od the Eu Council Directive No 112/2006 on the common system of value added tax and the resulted case law, in the scope of which activities a commune acts as VAT payer.

Keywords

• commune
• economic activity
• tax on goods and services
• act on tax on goods and services
• council directive no 112/2006 on the common system of value added tax