What changed, Sixth Council Directive of 17 May 1977 on the harmonization of the laws of the Member Stat…

+ ## TITLE I / INTRODUCTORY PROVISIONS
+ 
+ ### Article 1
+ 
+ Member States shall modify their present value added tax systems in accordance with the following Articles.
+ 
+ They shall adopt the necessary laws, regulations and administrative provisions so that the systems as modified enter into force at the earliest opportunity and by 1 January 1978 at the latest.
+ 
+ ## TITLE II / SCOPE
+ 
+ ### Article 2
+ 
+ The following shall be subject to value added tax:
+ 
+ 1. the supply of goods or services effected for consideration within the territory of the country by a taxable person acting as such;
+ 
+ 2. the importation of goods.
+ 
+ ## TITLE III / TERRITORIAL APPLICATION
+ 
+ ### Article 3
+ 
+ (1) For the purposes of this Directive:
+ 
+ — ‘territory of a Member State’ shall mean the territory of the country as defined in respect of each Member State in paragraphs 2 and 3,
+ 
+ — ‘Community’ and ‘territory of the Community’ shall mean the territory of the Member States as defined in respect of each Member State in paragraphs 2 and 3,
+ 
+ — ‘third territory’ and ‘third country’ shall mean any territory other than those defined in paragraphs 2 and 3 as the territory of a Member State.
+ 
+ (2) For the purposes of this Directive, the ‘territory of the country’ shall be the area of application of the Treaty establishing the European Economic Community as defined in respect of each Member State in Article 227.
+ 
+ (3) The following territories of individual Member States shall be excluded from the territory of the country:
+ 
+ — Federal Republic of Germany:
+ 
+ the Island of Heligoland,
+ 
+ the territory of Büsingen,
+ 
+ — Kingdom of Spain:
+ 
+ Ceuta,
+ 
+ Melilla,
+ 
+ — Republic of Italy:
+ 
+ Livigno,
+ 
+ Campione d'Italia,
+ 
+ the Italian wates of Lake Lugano.
+ 
+ The following territories of individual Member States shall also be excluded from the territory of the country:
+ 
+ — Kingdom of Spain:
+ 
+ — the Canary Islands,
+ 
+ — French Republic:
+ 
+ — the overseas departments,
+ 
+ — Hellenic Republic
+ 
+ — ΆγιοΌρος.
+ 
+ (4) By way of derogation from paragraph 1, in view of the conventions and treaties which they have concluded respectively with the French Republic and the United Kingdom of Great Britain and Northern Ireland, the Principality of Monaco and the Isle of Man shall not be treated for the purposes of the…
+ 
+ Member States shall take the measures necessary to ensure that transactions originating in or intended for:
+ 
+ — the Principality of Monaco are treated as transactions originating in or intended for the French Republic,
+ 
+ — the Isle of Man are treated as transactions originating in or intended for the United Kingdom of Great Britain and Northern Ireland.
+ 
+ (5) If the Commission considers that the provisions laid down in paragraphs 3 and 4 are no longer justified, particularly in terms of fair competition or own resources, it shall submit appropriate proposals to the Council.
+ 
+ ## TITLE IV / TAXABLE PERSONS
+ 
+ ### Article 4
+ 
+ 1. ‘Taxable person’ shall mean any person who independently carries out in any place any economic activity specified in paragraph 2, whatever the purpose or results of that activity.
+ 
+ 2. The economic activities referred to in paragraph 1 shall comprise all activities of producers, traders and persons supplying services including mining and agricultural activities and activities of the professions. The exploitation of tangible or intangible property for the purpose of obtaining in…
+ 
+ 3. Member States may also treat as a taxable person anyone who carries out, on an occasional basis, a transaction relating to the activities referred to in paragraph 2 and in particular one of the following:
+ 
+ (a) the supply before first occupation of buildings or parts of buildings and the land on which they stand; Member States may determine the conditions of application of this criterion to transformations of buildings and the land on which they stand.
+ 
+ Member States may apply criteria other than that of first occupation, such as the period elapsing between the date of completion of the building and the date of first supply or the period elapsing between the date of first occupation and the date of subsequent supply, provided that these periods do …
+ 
+ ‘A building’ shall be taken to mean any structure fixed to or in the ground;
+ 
+ (b) the supply of building land.
+ 
+ ‘Building land’ shall mean any unimproved or improved land defined as such by the Member States.
+ 
+ 4. The use of the word ‘independently’ in paragraph 1 shall exclude employed and other persons from the tax in so far as they are bound to an employer by a contract of employment or by any other legal ties creating the relationship of employer and employee as regards working conditions, remuneration…
+ 
+ Subject to the consultations provided for in Article 29, each Member State may treat as a single taxable person persons established in the territory of the country who, while legally independent, are closely bound to one another by financial, economic and organizational links.
+ 
+ 5. States, regional and local government authorities and other bodies governed by public law shall not be considered taxable persons in respect of the activities or transactions in which they engage as public authorities, even where they collect dues, fees, contributions or payments in connection wi…
+ 
+ However, when they engage in such activities or transactions, they shall be considered taxable persons in respect of these activities or transactions where treatment as non-taxable persons would lead to significant distortions of competition.
+ 
+ In any case, these bodies shall be considered taxable persons in relation to the activities listed in Annex D, provided they are not carried out on such a small scale as to be negligible.
+ 
+ Member States may consider activities of these bodies which are exempt under Article 13 or 28 as activities which they engage in as public authorities.
+ 
+ ## TITLE V / TAXABLE TRANSACTIONS
+ 
+ ### Article 5 — Supply of goods
+ 
+ 1. ‘Supply of goods’ shall mean the transfer of the right to dispose of tangible property as owner.
+ 
+ 2. Electric current, gas, heat, refrigeration and the like shall be considered tangible property.
+ 
+ 3. Member States may consider the following to be tangible property:
+ 
+ (a) certain interest in immovable property;
+ 
+ (b) rights *in rem* giving the holder thereof a right of user over immovable property;
+ 
+ (c) shares or interests equivalent to shares giving the holder thereof *de jure* or *de facto* rights of ownership or possession over immovable property or part thereof.
+ 
+ 4. The following shall also be considered supplies within the meaning of paragraph 1:
+ 
+ (a) the transfer, by order made by or in the name of a public authority or in pursuance of the law, of the ownership of property against payment of compensation;
+ 
+ (b) the actual handing over of goods, pursuant to a contract for the hire of goods for a certain period or for the sale of goods on deferred terms, which provides that in the normal course of events ownership shall pass at the latest upon payment of the final instalment;
+ 
+ (c) the transfer of goods pursuant to a contract under which commission is payable on purchase or sale.
+ 
+ 5. Member States may consider the handing over of certain works of construction to be supplies within the meaning of paragraph 1.
+ 
+ 6. The application by a taxable person of goods forming part of his business assets for his private use or that of his staff, or the disposal thereof free of charge or more generally their application for purposes other than those of his business, where the value added tax on the goods in question o…
+ 
+ 7. Member States may treat as supplies made for consideration:
+ 
+ (a) the application by a taxable person for the purposes of his business of goods produced, constructed, extracted, processed, purchased or imported in the course of such business, where the value added tax on such goods, had they been acquired from another taxable person, would not be wholly deduct…
+ 
+ (b) the application of goods by a taxable person for the purposes of a non-taxable transaction, where the value added tax on such goods became wholly or partly deductible upon their acquisition or upon their application in accordance with subparagraph (a);
+ 
+ (c) except in those cases mentioned in paragraph 8, the retention of goods by a taxable person or his successors when he ceases to carry out a taxable economic activity where the value added tax on such goods became wholly or partly deductible upon their acquisition or upon their application in acco…
+ 
+ 8. 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 in that event the recipient shall be treated as the successor to the transferor. Where ap…
+ 
+ ### Article 6 — Supply of services
+ 
+ 1. ‘Supply of services’ shall mean any transaction which does not constitute a supply of goods within the meaning of Article 5.
+ 
+ Such transactions may include *inter alia*:
+ 
+ — assignments of intangible property whether or not it is the subject of a document establishing title,
+ 
+ — obligations to refrain from an act or to tolerate an act or situation,
+ 
+ — the performances of services in pursuance of an order made by or in the name of a public authority or in pursuance of the law.
+ 
+ 2. The following shall be treated as supplies of services for consideration:
+ 
+ (a) the use of goods forming part of the assets of a business for the private use of the taxable person or of his staff or more generally for purposes other than those of his business where the value added tax on such goods is wholly or partly deductible;
+ 
+ (b) supplies of services carried out free of charge by the taxable person for his own private use or that of his staff or more generally for purposes other than those of his business.
+ 
+ Member States may derogate from the provisions of this paragraph provided that such derogation does not lead to distortion of competition.
+ 
+ 3. In order to prevent distortion of competition and subject to the consultations provided for in Article 29, Member States may treat as a supply of services for consideration the supply by a taxable person of a service for the purposes of his undertaking where the value added tax on such a service,…
+ 
+ 4. Where a taxable person acting in his own name but on behalf of another takes part in a supply of services, he shall be considered to have received and supplied those services himself.
+ 
+ 5. Article 5 (8) shall apply in like manner to the supply of services.
+ 
+ ### Article 7 — Imports
+ 
+ 1. ‘Importation’ of goods shall mean:
+ 
+ (a) the entry into the Community of goods which do not fulfil the conditions laid down in Articles 9 and 10 of the Treaty establishing the European Economic Community or, where the goods are covered by the Treaty establishing the European Coal and Steel Community, are not in free circulation;
+ 
+ (b) the entry into the Community of goods from a third territory, other than the goods covered by (a).
+ 
+ 2. The place of import of goods shall be the Member State within the territory of which the goods are when they enter the Community.
+ 
+ 3. Notwithstanding paragraph 2, where goods referred to in paragraph 1 (a) are, on entry into the Community, placed under one of the arrangements referred to in Article 16 (1) (B) ►M6 (a), (b), (c) and (d)** ◄ **, under arrangements for temporary importation with total exemption from import duty or …
+ 
+ Similarly, when goods referred to in paragraph 1 (b) are placed, on entry into the Community, under one of the procedures referred to in Article 33a (1) (b) or (c), the place of import shall be the Member State within whose territory this procedure ceases to apply.
+ 
+ ## TITLE VI / PLACE OF TAXABLE TRANSACTIONS
+ 
+ ### Article 8 — Supply of goods
+ 
+ 1. The place of supply of goods shall be deemed to be:
+ 
+ (a) in the case of goods dispatched or transported either by the supplier or by the person to whom they are supplied or by a third person: the place where the goods are at the time when dispatch or transport to the person to whom they are supplied begins. where the goods are installed or assembled, …
+ 
+ (b) in the case of goods not dispatched or transported: the place where the goods are when the supply takes place.
+ 
+ (c) in the case of goods supplied on board ships, aircraft or trains during the part of a transport of passengers effected in the Community: at the point of the departure of the transport of passengers.
+ 
+ For the purposes of applying this provision:
+ 
+ — ‘part of a transport of passengers effected in the Community’ shall mean the part of the transport effected, without a stop in a third territory, between the point of departure and the point of arrival of the transport of passengers,
+ 
+ — ‘the point of departure of the transport of passengers’ shall mean the first point of passenger embarkation foreseen within the Community, where relevant after a leg outside the Community,
+ 
+ — ‘the point of arrival of the transport of passengers’ shall mean the last point of disembarkation of passengers foreseen within the Community of passengers who embarked in the Community, where relevant before a leg outside the Community.
+ 
+ In the case of a return trip, the return leg shall be considered to be a separate transport.
+ 
+ The Commission shall, by 30 June 1993 at the latest, submit to the Council a report accompanied, if necessary, by appropriate proposals on the place of taxation of goods supplied for consumption and services, including restaurant services, provided for passengers on board ships, aircraft or trains.
+ 
+ By 31 December 1993, after consulting the European Parliament, the Council shall take a unanimous decision on the Commission proposal.
+ 
+ Until 31 December 1993, Member States may exempt or continue to exempt goods supplied for consumption on board whose place of taxation is determined in accordance with the above provisions, with the right to deduct the value added tax paid at an earlier stage.
+ 
+ (d) in the case of the supply of gas through the natural gas distribution system, or of electricity, to a taxable dealer: the place where that taxable dealer has established his business or has a fixed establishment for which the goods are supplied, or, in the absence of such a place of business or …
+ 
+ ‘Taxable dealer’ for the purposes of this provision means a taxable person whose principal activity in respect of purchases of gas and electricity is reselling such products and whose own consumption of these products is negligible.
+ 
+ (e) in the case of the supply of gas through the natural gas distribution system, or of electricity, where such a supply is not covered by point (d): the place where the customer has effective use and consumption of the goods. Where all or part of the goods are not in fact consumed by this customer,…
+ 
+ 2. By way of derogation from paragraph 1 (a), where the place of departure of the consignment or transport of goods is in a third territory, the place of supply by the importer as defined in ►M18 Article 21(4)** ◄ ** and the place of any subsequent supplies shall be deemed to be within the Member St…
+ 
+ ### Article 9 — Supply of services
+ 
+ 1. The place where a service is supplied shall be deemed to be the place where the supplier has established his business or has a fixed establishment from which the service is supplied or, in the absence of such a place of business or fixed establishment, the place where he has his permanent address…
+ 
+ 2. However:
+ 
+ (a) the place of the supply of services connected with immovable property, including the services of estate agents and experts, and of services for preparing and coordinating construction works, such as the services of architects and of firms providing on-site supervision, shall be the place where t…
+ 
+ (b) the place where transport services are supplied shall be the place where transport takes place, having regard to the distances covered;
+ 
+ (c) the place of the supply of services relating to:
+ 
+ — cultural, artistic, sporting, scientific, educational, entertainment or similar activities, including the activities of the organizers of such activities, and where appropriate, the supply of ancillary services,
+ 
+ — ancillary transport activities such as loading, unloading, handling and similar activities,
+ 
+ — valuations of movable tangible property,
+ 
+ — work on movable tangible property,
+ 
+ shall be the place where those services are physically carried out;
+ 
+ (e) the place where the following services are supplied: when performed for customers established outside the Community or for taxable persons established in the Community but not in the same country as the supplier, shall be the place where the customer has established his business or has a fixed e…
+ 
+ — transfers and assignments of copyrights, patents, licences, trade marks and similar rights,
+ 
+ — advertising services,
+ 
+ — services of consultants, engineers, consultancy bureaux, lawyers, accountants and other similar services, as well as data processing and the supplying of information,
+ 
+ — obligations to refrain from pursuing or exercising, in whole or in part, a business activity or a right referred to in this point (e),
+ 
+ — banking, financial and insurance transactions including reinsurance, with the exception of the hire of safes,
+ 
+ — the supply of staff,
+ 
+ — the services of agents who act in the name and for the account of another, when they procure for their principal the services referred to in this point (e).
+ 
+ — the hiring out of movable tangible property, with the exception of all forms of transport►M15 ,** ◄ **
+ 
+ — the provision of access to, and of transport or transmission through, natural gas and electricity distribution systems and the provision of other directly linked services,
+ 
+ — Telecommunications. Telecommunications services shall be deemed to be services relating to the transmission, emission or reception of signals, writing, images and sounds or information of any nature by wire, radio, optical or other electromagnetic systems, including the related transfer or assignm…
+ 
+ — radio and television broadcasting services,
+ 
+ — electronically supplied services, *inter alia*, those described in Annex L;
+ 
+ (f) the place where services referred to in the last indent of subparagraph (e) are supplied when performed for non-taxable persons who are established, have their permanent address or usually reside in a Member State, by a taxable person who has established his business or has a fixed establishment…
+ 
+ 3. In order to avoid double taxation, non-taxation or the distortion of competition, the Member States may, with regard to the supply of services referred to in paragraph 2(e), except for the services referred to in the last indent when supplied to non-taxable persons, and also with regard to the hi…
+ 
+ (a) the place of supply of services, which under this Article would be situated within the territory of the country, as being situated outside the Community where the effective use and enjoyment of the services take place outside the Community;
+ 
+ (b) the place of supply of services, which under this Article would be situated outside the Community, as being within the territory of the country where the effective use and enjoyment of the services take place within the territory of the country.
+ 
+ 4. In the case of telecommunications services and radio and television broadcasting services referred to in paragraph 2(e) when performed for non-taxable persons who are established, have their permanent address or usually reside in a Member State, by a taxable person who has established his busines…
+ 
+ ## TITLE VII / CHARGEABLE EVENT AND CHARGEABILITY OF TAX
+ 
+ ### Article 10
+ 
+ 1.
+ 
+ (a) ‘Chargeable event’ shall mean the occurrence by virtue of which the legal conditions necessary for tax to become chargeable are fulfilled.
+ 
+ (b) The tax becomes ‘chargeable’ when the tax authority becomes entitled under the law at a given moment to claim the tax from the person liable to pay, notwithstanding that the time of payment may be deferred.
+ 
+ 2. The chargeable event shall occur and the tax shall become chargeable when the goods are delivered or the services are performed. Deliveries of goods other than those referred to in Article 5 (4) (b) and supplies of services which give rise to successive statements of account or payments shall be …
+ 
+ However, where a payment is to be made on account before the goods are delivered or the services are performed, the tax shall become chargeable on receipt of the payment and on the amount received.
+ 
+ By way of derogation from the above provisions, Member States may provide that the tax shall become chargeable, for certain transactions or for certain categories of taxable person, either:
+ 
+ — no later than the issue of the invoice►M20 —————** ◄ **, or
+ 
+ — no later than receipt of the price, or
+ 
+ — where an invoice►M20 —————** ◄ ** is not issued, or is issued late, within a specified period from the date of the chargeable event.
+ 
+ 3. The chargeable event shall occur and the tax shall become chargeable when the goods are imported. Where goods are placed under one of the arrangements referred to in Article 7 (3) on entry into the Community, the chargeable event shall occur and the tax shall become chargeable only when the goods…
+ 
+ However, where imported goods are subject to customs duties, to agricultural levies or to charges having equivalent effect established under a common policy, the chargeable event shall occur and the tax shall become chargeable when the chargeable event for those Community duties occurs and those dut…
+ 
+ Where imported goods are not subject to any of those Community duties, Member States shall apply the provisions in force governing customs duties as regards the occurrence of the chargeable event and the moment when the tax becomes chargeable.
+ 
+ ## TITLE VIII / TAXABLE AMOUNT
+ 
+ ### Article 11
+ 
+ A. Within the territory of the country
+ 
+ 1. The taxable amount shall be:
+ 
+ (a) in respect of supplies of goods and services other than those referred to in (b), (c) and (d) below, everything which constitutes the consideration which has been or is to be obtained by the supplier from the purchaser, the customer or a third party for such supplies including subsidies directly…
+ 
+ (b) in respect of supplies referred to in Article 5 (6) and (7), the purchase price of the goods or of similar goods or, in the absence of a purchase price, the cost price, determined as the time of supply;
+ 
+ (c) in respect of supplies referred to in Article 6 (2), the full cost to the taxable person of providing the services;
+ 
+ (d) in respect of supplies referred to in Article 6 (3), the open market value of the services supplied.
+ 
+ ‘Open market value’ of services shall mean the amount which a customer at the marketing stage at which the supply takes place would have to pay to a supplier at arm's length within the territory of the country at the time of the supply under conditions of fair competition to obtain the services in q…
+ 
+ 2. The taxable amount shall include:
+ 
+ (a) taxes, duties, levies and charges, excluding the value added tax itself;
+ 
+ (b) incidental expenses such as commission, packing, transport and insurance costs charged by the supplier to the purchaser or customer. Expenses covered by a separate agreement may be considered to be incidental expenses by the Member States.
+ 
+ 3. The taxable amount shall not include:
+ 
+ (a) price reductions by way of discount for early payment;
+ 
+ (b) price discounts and rebates allowed to the customer and accounted for at the time of the supply;
+ 
+ (c) the amounts received by a taxable person from his purchaser or customer as repayment for expenses paid out in the name and for the account of the latter and which are entered in his books in a suspense account. The taxable person must furnish proof of the actual amount of this expenditure and ma…
+ 
+ 4. By way of derogation from paragraphs 1, 2 and 3, Member States which, on 1 January 1993, did not avail themselves of the option provided for in the third subparagraph of Article 12 (3) (a) may, where they avail themselves of the option provided for in Title B (6), provide that, for the transactio…
+ 
+ That fraction shall be determined in such a way that the value added tax thus due is, in any event, equal to at least 5 % of the amount determined in accordance with paragraphs 1, 2 and 3.
+ 
+ B. Importation of goods
+ 
+ 1. The taxable amount shall be the value for customs purposes, determined in accordance with the Community provisions in force; this shall also apply for the import of goods referred to in Article 7 (1) (b).
+ 
+ 3. The taxable amount shall include, in so far as they are not already included:
+ 
+ (a) taxes, duties, levies and other charges due outside the importing Member State and those due by reason of importation, excluding the value added tax to be levied;
+ 
+ (b) incidental expenses, such as commission, packing, transport and insurance costs, incurred up to the first place of destination within the territory of the importing Member State.
+ 
+ ‘First place of destination’ shall mean the place mentioned on the consignment note or any other document by means of which the goods are imported into the importing Member State. In the absence of such an indication, the first place of destination shall be taken to be the place of the first transfe…
+ 
+ The incidental expenses referred to above shall also be included in the taxable amount where they result from transport to another place of destination within the territory of the Community if that place is known when the chargeable event occurs.
+ 
+ 4. The taxable amount shall not include those factors referred to in A (3) (a) and (b).
+ 
+ 5. When goods have been temporarily exported ►M4 from the Community** ◄ ** and are re-imported after having undergone ►M4 outside the Community** ◄ ** repair, processing or adaptation, or after having been made up or reworked abroad, ►M4 ** ◄ ** Member States shall take steps to ensure that the trea…
+ 
+ 6. By way of derogation from paragraphs 1 to 4, Member States which, on 1 January 1993, did not avail themselves of the option provided for in the third subparagraph of Article 12 (3) (a) may provide that for imports of the works of art, collectors' items and antiques defined in Article 26a (A) (a),…
+ 
+ That fraction shall be determined in such a way that the value added tax thus due on the import is, in any event, equal to at least 5 % of the amount determined in accordance with paragraphs 1 to 4.
+ 
+ C. Miscellaneous provisions
+ 
+ 1. In the case of cancellation, refusal or total or partial non-payment, or where the price is reduced after the supply takes place, the taxable amount shall be reduced accordingly under conditions which shall be determined by the Member States.
+ 
+ However, in the case of total or partial non-payment, Member States may derogate from this rule.
+ 
+ 2. Where information for determining the taxable amount on importation is expressed in a currency other than that of the Member State where assessment takes place, the exchange rate shall be determined in accordance with the Community provisions governing the calculation of the value for customs pur…
+ 
+ Where information for the determination of the taxable amount of a transaction other than an import transaction is expressed in a currency other than that of the Member State where assessment takes place, the exchange rate applicable shall be the latest selling rate recorded, at the time the tax bec…
+ 
+ 3. As regards returnable packing costs, Member States may:
+ 
+ — either exclude them from the taxable amount and take the necessary measures to see that this amount is adjusted if the packing is not returned,
+ 
+ — or include them in the taxable amount and take the necessary measures to see that this amount is adjusted where the packing is in fact returned.
+ 
+ ## TITLE IX / RATES
+ 
+ ### Article 12
+ 
+ 1. The rate applicable to taxable transactions shall be that in force at the time of the chargeable event. However:
+ 
+ (a) in the cases provided for in the second and third subparagraphs of Article 10 (2), the rate to be used shall be that in force when the tax becomes chargeable;
+ 
+ (b) in the cases provided for in the second and third subparagraphs of Article 10 (3), the rate applicable shall be that in force at the time when the tax becomes chargeable.
+ 
+ 2. In the event of changes in the rates, Member States may:
+ 
+ — effect adjustments in the cases provided for in paragraph 1 (a) in order to take account of the rate applicable at the time when the goods or services were supplied,
+ 
+ — adopt all appropriate transitional measures.
+ 
+ 3.
+ 
+ (a) The standard rate of value added tax shall be fixed by each Member State as a percentage of the taxable amount and shall be the same for the supply of goods and for the supply of services. From 1 January 2001 to 31 December 2005, this percentage may not be less than 15 %.
+ 
+ On a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, the Council shall decide unanimously on the level of the standard rate to be applied after 31 December 2005.
+ 
+ Member States may also apply either one or two reduced rates. These rates shall be fixed as a percentage of the taxable amount, which may not be less than 5 %, and shall apply only to supplies of the categories of goods and services specified in Annex H.
+ 
+ The third subparagraph shall not apply to the services referred to in the last indent of Article 9(2)(e).
+ 
+ (b) Member States may apply a reduced rate to supplies of natural gas and electricity provided that no risk of distortion of competition exists. A Member State intending to apply such a rate must, before doing so, inform the Commission. The Commission shall give a decision on the existence of a risk…
+ 
+ (c) Member States may provide that the reduced rate, or one of the reduced rates, which they apply in accordance with the third paragraph of (a) shall also apply to imports of works of art, collectors' items and antiques as referred to in Article 26a (A) (a), (b) and (c).
+ 
+ Where they avail themselves of this option, Member States may also apply the reduced rate to supplies of works of art, within the meaning of Article 26a (A) (a):
+ 
+ — effected by their creator or his successors in title,
+ 
+ — effected on an occasional basis by a taxable person other than a taxable dealer, where these works of art have been imported by the taxable person himself or where they have been supplied to him by their creator or his successors in title or where they have entitled him to full deduction of value-…
+ 
+ 4. ►M5 ** ◄ ** Each reduced rate shall be so fixed that the amount of value added tax resulting from the application thereof shall be such as in the normal way to permit the deduction therefrom of the whole of the value added tax deductible under the provisions of Article 17.
+ 
+ On the basis of a report from the Commission, the Council shall, starting in 1994, review the scope of the reduced rates every two years. The Council, acting unanimously on a proposal from the Commission, may decide to alter the list of goods and services in Annex H.
+ 
+ 5. Subject to paragraph 3 (c), the rate applicable on the importation of goods shall be that applied to the supply of like goods within the territory of the country.
+ 
+ 6. The Portuguese Republic may apply to transactions carried out in the autonomous regions of the Azores and Madeira and to direct imports to those regions, reduced rates in comparison to those applying on the mainland
+ 
+ ## TITLE X / EXEMPTIONS
+ 
+ ### Article 13 — Exemptions within the territory of the country
+ 
+ A. Exemptions for certain activities in the public interest
+ 
+ 1. Without prejudice to other Community provisions, Member States shall exempt the following under conditions which they shall lay down for the purpose of ensuring the correct and straightforward application of such exemptions and of preventing any possible evasion, avoidance or abuse:
+ 
+ (a) the supply by the public postal services of services other than passenger transport and telecommunications services, and the supply of goods incidental thereto;
+ 
+ (b) hospital and medical care and closely related activities undertaken by bodies governed by public law or, under social conditions comparable to those applicable to bodies governed by public law, by hospitals, centres for medical treatment or diagnosis and other duly recognized establishments of a…
+ 
+ (c) the provision of medical care in the exercise of the medical and paramedical professions as defined by the Member State concerned;
+ 
+ (d) supplies of human organs, blood and milk;
+ 
+ (e) services supplied by dental technicians in their professional capacity and dental prostheses supplied by dentists and dental technicians;
+ 
+ (f) services supplied by independent groups of persons whose activities are exempt from or are not subject to value added tax, for the purpose of rendering their members the services directly necessary for the exercise of their activity, where these groups merely claim from their members exact reimb…
+ 
+ (g) the supply of services and of goods closely linked to welfare and social security work, including those supplied by old people's homes, by bodies governed by public law or by other organizations recognized as charitable by the Member State concerned;
+ 
+ (h) the supply of services and of goods closely linked to the protection of children and young persons by bodies governedf by public law or by other organizations recognized as charitable by the Member State concerned;
+ 
+ (i) children's or young people's education, school or university education, vocational training or retraining, including the supply of services and of goods closely related thereto, provided by bodies governed by public law having such as their aim or by other organizations defined by the Member Sta…
+ 
+ (j) tuition given privately by teachers and covering school or university education;
+ 
+ (k) certain supplies of staff by religious or philosophical institutions for the purpose of subparagraphs (b), (g), (h) and (i) of this Article and with a view to spiritual welfare;
+ 
+ (l) supply of services and goods closely linked thereto for the benefit of their members in return for a subscription fixed in accordance with their rules by non-profit-making organizations with aims of a political, tradeunion, religious, patriotic, philosophical, philanthropic or civic nature, prov…
+ 
+ (m) certain services closely linked to sport or physical education supplied by non-profit-making organizations to persons taking part in sport or physical education;
+ 
+ (n) certain cultural services and goods closely linked thereto supplied by bodies governed by public law or by other cultural bodies recognized by the Member State concerned;
+ 
+ (o) the supply of services and goods by organizations whose activities are exempt under the provisions of subparagraphs (b), (g), (h), (i), (l), (m) and (n) above in connection with fund-raising events organized exclusively for their own benefit provided that exemption is not likely to cause distort…
+ 
+ (p) the supply of transport services for sick or injured persons in vehicles specially designed for the purpose by duly authorized bodies;
+ 
+ (q) activities of public radio and television bodies other than those of a commercial nature.
+ 
+ 2.
+ 
+ a) Member States may make the granting to bodies other than those governed by public law of each exemption provided for in (1) (b), (g), (h), (i), (1), (m) and (n) of this Article subject in each individual case to one or more of the following conditions:
+ 
+ — they shall not systematically aim to make a profit, but any profits nevertheless arising shall not be distributed, but shall be assigned to the continuance or improvement of the services supplied,
+ 
+ — they shall be managed and administered on an essentially voluntary basis by persons who have no direct or indirect interest, either themselves or through intermediaries, in the results of the activities concerned,
+ 
+ — they shall charge prices approved by the public authorities or which do not exceed such approved prices or, in respect of those services not subject to approval, prices lower than those charged for similar services by commercial enterprises subject to value added tax,
+ 
+ — exemption of the services concerned shall not be likely to create distortions of competition such as to place at a disadvantage commercial enterprises liable to value added tax.
+ 
+ (b) The supply of services or goods shall not be granted exemption as provided for in (1) (b), (g), (h), (i), (l), (m) and (n) above if:
+ 
+ — it is not essential to the transactions exempted,
+ 
+ — its basic purpose is to obtain additional income for the organization by carrying out transactions which are in direct competition with those of commercial enterprises liable for value added tax.
+ 
+ B. Other exemptions
+ 
+ Without prejudice to other Community provisions, Member States shall exempt the following under conditions which they shall lay down for the purpose of ensuring the correct and straightforward application of the exemptions and of preventing any possible evasion, avoidance or abuse:
+ 
+ (a) insurance and reinsurance transactions, including related services performed by insurance brokers and insurance agents;
+ 
+ (b) the leasing or letting of immovable property excluding:
+ 
+ 1. the provision of accomodation, as defined in the laws of the Member States, in the hotel sector or in sectors with a similar function, including the provision of accomodation in holiday camps or on sites developed for use as camping sites;
+ 
+ 2. the letting of premises and sites for parking vehicles;
+ 
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