Victory against tax authorities regarding VAT

Our tax litigation team has successfully represented a leading company in industrial freezing systems in a tax dispute. Lithuanian tax authorities denied a possibility for our client to apply a ‘zero’ VAT rate on the supply of freezing systems in fishing vessels. Tax authorities have argued that such supply is not related to the purpose of fishing activities. Our law firm successfully represented the client and proved that the refrigeration system is indirectly related to fishing activities.

It was the first tax dispute in Lithuania where a ‘zero’ VAT rate was applicable to the supply of equipment that is indirectly related to fishing activities. Constructive analysis of the case law of the CJEU allowed our law firm to prove that a refrigeration system in fishing vessels is an inseparable part of the fishing vessel itself. Despite the fact that all tax exemptions must be applied strictly within the limits prescribed in law, our arguments were accepted by the tax authorities in full.