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05 November 2024

Norway court's VAT registration decision for foreign online fashion company is now final

  • The Norwegian Supreme Court has declined to hear the appeal of an appellate court's decision in favor of a nonresident online fashion retailer applying for a simplified value-added tax (VAT) registration for business-to-consumer (B2C) sales of small consignments.
  • The decision is relevant for all foreign online platforms that make B2C sales to Norwegian consumers of small consignments of goods or B2C sales of intangible services.
 

A Norwegian Court of Appeals decision from June 2024 in favor of a nonresident online fashion company in a case challenging the Norwegian Tax Authority has become final, as the Norwegian Supreme Court declined to consider an appeal. The company is now granted a simplified VAT registration (referred to as a VOEC registration) for B2C sales of small consignments, also involving customs duties relief on clothes. The case considered the validity of the Norwegian Tax Authority's decision to reject the company's application for simplified registration for VAT. A VOEC registration involves not only simplified reporting and import procedures, but also customs duties relief on clothes and other textiles valued at less than 3,000 Norwegian krone (NOK 3,000) per item.

The Tax Authority argued that the company's multilingual website, which included the Norwegian language and Norwegian currency, indicated a strong link to Norway, meaning that the company was obliged to carry out a full VAT registration in the Norwegian VAT register. The Tax Authority appealed the Court of Appeals' unanimous decision to the Norwegian Supreme Court. However, the Supreme Court has now decided that the appeal will not be accepted.

The decision is relevant for foreign online platforms with B2C sales of either small consignments or B2C sales of intangible services in Norway. Note that the VOEC scheme does not apply for foodstuff and beverages.

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Contact Information

For additional information concerning this Alert, please contact:

EY Norway, Oslo

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor

Document ID: 2024-2032

 
 

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