VAT exemption for granting and negotiating credit

Regarding the literal interpretation, a comparison of the different language versions shows that the text of Article 135(1)(b) of the VAT Directive can be interpreted differently: either the exemption is reserved for the original provider or the current provider. The first interpretation, according to which the exemption is reserved for the original provider, derives in particular from the Greek, French, and Dutch versions, which use a verb conjugated in the past tense to describe the granting of credit. This means that the person benefiting from the exemption is the one who paid the credit amount to the borrower, in the past and at the beginning of the contractual relationship.

The second interpretation, according to which the exemption is reserved for the current provider, is supported in particular by the English, Croatian, Romanian, and Slovenian versions of the text, which, by using the equivalent of the verb "concessire" conjugated in the present tense, refer to the current existence of the credit. The German and Finnish versions of this provision can be interpreted in both ways. In this context, the wording of Article 135(1)(b) of the VAT Directive does not provide a clear answer to the question of who should benefit from the credit management exemption.

The context of Article 135(1)(b)...