A draft of the information from Czech General Finance Directorate (GFŘ) on the application of VAT on refuelling cards caused commotion in the professional public and businesses as well. The practice so far is that transactions between the fuel supplier and the card issuer, as well as between the card issuer and the final customer, are considered to be the supply of goods with the output VAT to be paid and the right to deduct input VAT incurred. There is a similar practice in other EU countries. In the light of the case-law of the European Court of Justice, the GFŘ wishes to amend this practice and treat the transactions provided by the card issuer as a financial service. This would mean, in practice, that the final customer could not claim a deduction for invoices issued by the card company. In addition, the GFŘ has been proposing the application of the new system since April 2020. We will inform you of further developments in the case.
