Facts
The [X. AG] , a mail-order and goods trade company, was requested by the Federal Tax Administration to submit a statement of income from reminder fees. The Federal Tax Administration charged the [X. AG] VAT in the amount of CHF 3'655.-- for income from reminder fees for the period from January 1, 1995 to December 31, 1996. The [X. AG] contested the subsequent assessment and filed a complaint with the Federal Tax Appeals Commission, which dismissed the complaint.
The [X. AG] then filed an administrative appeal with the Federal Supreme Court and requested that the decision of the Federal Tax Appeals Commission be set aside and that it be established that the amounts collected by the appellant in addition to the cash purchase price were not part of the taxable consideration.
Considerations
The Federal Supreme Court examined whether the installment surcharges and reminder fees collected by the [X. AG] from its customers are part of the taxable consideration. It found that the installment surcharges represent an ancillary service that is closely related to the main service of goods delivery and complements it.
The court ruled that the installment surcharges must be considered as part of the consideration for VAT purposes, as they represent compensation for the administrative and capital costs incurred due to the installment plan, as well as costs for advertising and announcing the installment payment options.
The Federal Supreme Court also rejected the argument of the [X. AG] that the installment surcharges should be considered as an independent main service, as they offer customers the opportunity to defer payment of…