Facts
The [X.] Management AG, a subsidiary of [X.] Holding AG, provided management services to other affiliated companies of the [X.] Group and [X.] Holding AG. The Federal Tax Administration conducted an audit and invoiced a value-added tax amount of CHF 6,029,896.00 plus interest on arrears. The additional payment resulted mainly from insufficiently documented service exports.
[X.] Management AG requested the cancellation of the decisions of the Federal Tax Appeals Commission and the Federal Tax Administration and the reduction of the value-added tax claim to CHF 167,692.-- plus interest of 5% since April 30, 1997.
The Federal Court had to assess which requirements are to be imposed on the evidence for the export of management services and whether these are fulfilled in the specific case or not.
Considerations
The Federal Court examined the requirements for the export evidence of management services and found that the Federal Tax Administration had established the requirements for the evidence of services provided abroad in its 1997 guidelines for value-added tax payers. According to this, written orders or written contracts or a written power of attorney and copies of invoices as well as payment receipts are required, from which the name/company, address, and domicile/seat of the buyer or customer as well as detailed information about the type and use of the services provided can be clearly determined.
The court found that [X.] Management AG did not meet the requirements for the…