Legal practice in VAT deduction lawsuits

The Curia of Hungary has published a document with detailed information on its legal practice in lawsuits concerning VAT deduction matters. In the future this document can act as a sort of guideline for enterprises, so that they need to take fewer risks in completing their deals. According to Dr Mihály Harcos, leader of the tax litigation practice at Deloitte Legal, in the future courts’ rulings may shift in favour of tax payers. The document reveals that the National Tax and Customs Administration (NAV) has won 60 percent of tax lawsuits, while in 40 percent of cases the courts’ decision has been in favour – in part or in full – of enterprises. It also turned out that in most cases NAV imposed a fine on tax payers because at the time of the tax authorities’ inspection the documents supporting the rightfulness of the VAT deduction were unavailable.