Facts
The association "Golf Club X." headquartered in Y. has been registered in the value-added tax register since March 1998 and settles accounts with the Swiss Federal Tax Administration (ESTV) using the actual ("statutory") method. In February 2001, the ESTV approved the golf club's request to tax the tournament fees that were tax-exempt by law, effective January 1, 2001. In the accounting periods from 2001 to 2009, the golf club charged the tournament fees at the reduced tax rate.
In October 2012, the ESTV conducted an audit at the golf club. It found that the golf club had indeed taxed the tournament fees in the quarterly statements to the ESTV, but had not indicated the existence and amount of the tax in the contribution invoices to the members. The ESTV therefore considered the turnover from tournament contributions to be tax-exempt, reduced the input tax deduction, and made a subsequent charge. The golf club's objection and appeal to the Federal Administrative Court were unsuccessful. The Federal Supreme Court dismissed the golf club's appeal.
Considerations
The Federal Supreme Court states that the requirement of "open disclosure of the tax" pursuant to Art. 22 para. 1 of the Value Added Tax Act (MWSTG) is not merely an administrative regulation, but a validity regulation. This means that the golf club must include a combined declaration of intent and knowledge of the existence and amount of the tax on the debtor's invoice in order to effectively exercise the option to tax the tournament fees.
The Federal Supreme Court further states that the "open disclosure of the tax" must be made not only in the quarterly statement to the ESTV, but also on the invoice to the members. A mere announcement of the…