Case C-491/03

Ottmar Hermann

v

Stadt Frankfurt am Main

(Reference for a preliminary ruling from the Hessischer Verwaltungsgerichtshof)

(Indirect tax – Directive 92/12/EEC – Local tax on the supply of alcoholic beverages for immediate consumption on the premises)

Opinion of Advocate General Ruiz-Jarabo Colomer delivered on 11 January 2005

Judgment of the Court (First Chamber), 10 March 2005

Summary of the Judgment

Tax provisions – Harmonisation of laws – Excise duties – Directive 92/12 – Alcohol and alcoholic beverages – Tax on the supply of beverages for immediate consumption on the premises – Classification of tax not on products subject to excise duty but on the provision of services relating to such products – Need for that tax to pursue specific purposes – None

(Council Directive 92/12, Art. 3(2) and (3))

A tax which is levied, in a catering context, on the supply for consideration of alcoholic beverages for immediate consumption on the premises must be considered to be a tax on the supply of services relating to products subject to excise duty which cannot be characterised as a turnover tax for the purposes of the second subparagraph of Article 3(3) of Directive 92/12 on the general arrangements for products subject to excise duty and on the holding, movement and monitoring of such products.

In order to determine whether a tax applies to products subject to excise duty for the purposes of Article 3(2) of Directive 92/12 or, rather, to the services supplied in relation to such products for the purposes of the second subparagraph of Article 3(3), regard must be had to the predominant feature of the transaction on which it is imposed. A supply of alcoholic beverages in a catering context is characterised by an array of features and acts, of which the supply of the product itself is only one component and in which services predominate.

In addition, the ‘same proviso’ to which taxes falling within the scope of the second subparagraph of Article 3(3) are subject refers only to the condition set out in the first subparagraph of that paragraph, namely that such ‘taxes do not give rise to border-crossing formalities in trade between Member States’. The directive therefore does not require that the taxes concerned comply with the condition laid down in Article 3(2), namely that they be for a specific purpose.

(see paras 21, 27, 30, 33-34, operative part 1, 2)

JUDGMENT OF THE COURT (First Chamber) 10 March 2005 (1)

(Indirect tax – Directive 92/12/EEC – Local tax on the supply of alcoholic beverages for immediate consumption on the premises)

In Case C-491/03,REFERENCE for a preliminary ruling under Article 234 EC from the Hessischer Verwaltungsgerichtshof (Germany), made by order of 1 October 2003, received at the Court on 20 November 2003, in the proceedings

v

THE COURT (First Chamber),,

composed of P. Jann, President of the Chamber, K. Lenaerts (Rapporteur), N. Colneric, K. Schiemann and E. Juhász, Judges,

Advocate General: D. Ruiz-Jarabo Colomer,

having regard to the written procedure and further to the hearing on 2 December 2004,after considering the observations submitted on behalf of:

after hearing the Opinion of the Advocate General at the sitting on 11 January 2005,

gives the following

‘This Directive lays down the arrangements for products subject to excise duties and other indirect taxes which are levied directly or indirectly on the consumption of such products, except for value added tax and taxes established by the Community’.

‘1.

2.

3.Subject to the same proviso, Member States shall also retain the right to levy taxes on the supply of services which cannot be characterised as turnover taxes, including those relating to products subject to excise duty.’

‘(1)

(2)

(3)

‘(1)

(2)

‘1.

2.In connection with the taxation of a supply of services relating to products subject to excise duty within the meaning of Article 3(1) of Directive 92/12, does the phrase “subject to the same proviso” in the second subparagraph of Article 3(3) of Directive 92/12/EEC refer only to the proviso contained in the first subparagraph of Article 3(3) of that directive, namely “provided, however, that those taxes do not give rise to border-crossing formalities in trade between Member States”, or in such a case must the tax also be for “specific purposes”, as laid down in Article 3(2) of the directive?’

On those grounds, the Court (First Chamber) rules as follows:

[Signatures]