Facts
FC [X.] is a football club registered as a taxable person for VAT with the Federal Tax Administration. The Federal Tax Administration issued various supplementary invoices asserting tax claims. FC [X.] filed a complaint against these decisions with the Federal Tax Appeal Commission, which, however, dismissed the complaint. Thereupon, FC [X.] filed an administrative court appeal with the Federal Supreme Court.Considerations
The Federal Supreme Court states that sponsorship income is subject to VAT if it is associated with a quid pro quo. It is irrelevant whether there is a legal entitlement to the consideration or whether the service and consideration are in a reasonable proportion in terms of value. The decisive factor is that the advertising services of the club are linked to the services of the sponsors and caused by them. A division into a taxable advertising service portion and a non-taxable…