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Netherlands ruling on VAT on telephone cards and store vouchers

  • VAT
  • 15 February 2013 | Richard Asquith

Netherlands ruling on VAT on telephone cards and store vouchers

The Dutch Court of Appeal has recently ruled on the tax point of Dutch VAT on the sales of telephone cards.

Telephone cards sold to consumers for Value Added Services are recognised as the provision of two services – the supply of telephone access time, plus increasingly access to other digital content for ‘smart phones’. Whilst the face value of the card is for both, there are different tax points. The telecoms service is when the card is purchased; whereas digital services is when the content is downloaded and consumed.

This then raises the question of what value the manufacturers of these cards should use for calculating the VAT charge to their distributors – the face value of the card or the amount charged to the distributor.

The Court held that the VAT should be based on the amount paid by the distributor to the manufacturer – not the face value, and this should be reported in the Dutch VAT return. The court also held that this ruling applied to store vouchers as well as telephone cards.


VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.