Charging of electric vehicles considered a supply of goods

The Court of Justice of the European Union ruled in April 2023 on a long-standing question related to the charging of electric vehicles. The question was whether the charging of electric vehicles and making the charging network available to users should, from VAT point of view, be regarded as a performance of services, or a supply of goods. 

The ruling was issued at the instigation of the Polish Supreme Court. It related to a Polish company operating publicly accessible charging stations. Payments can be made via NFC or with a charging card. In addition to the electricity supply, customers were also provided with charging equipment, technical support, a specialized platform for booking a charging station, and the option to pay by electronic wallet. The complexity of the provided activities led to the question of whether the activities should be considered as a provision of a service, or the delivery of goods. 

In the opinion of the Court of Justice, the supply of electricity is the characteristic and predominant element of the composite supply and the remaining activities, such as technical support, online booking and electronic wallet, are only secondary activities. 

Clarification of this question is important not only for entrepreneurs operating charging stations and providing these services, but also for businesses who allow their employees or customers to charge electric vehicles for free.

Takeaway

Entrepreneurs who make charging stations available abroad may be required to register for VAT in such a country, as this is a supply of goods. We also recommend assessing the VAT treatment in case of using “foreign fuel cards” to pay for charging in Slovakia. In addition, making charging stations available for employees or customers for free represents a supply of goods, with regard to which the provider may be liable to pay VAT.