A trader selling excise goods exempt from excise duty by reason of their intended use does not need to verify their use by the buyer in order to obtain such exemption. This is due to the interpretation of the Director of National Tax Information on 16 March 2017 The signature. 2461-IBPP4.4513.400.2017.1.MK.
The interpretation concerns a company that trades, among others, marine fuels, which is considering the sale of LNG (condensed natural gas) of a shipbuilding yard. Such an operation (sale of fuel) is, in principle, taxed on excise duty, however, provides for an exemption in this respect.
The Director of National Tax Information issued an interpretation favourable to the company, recognising that excise duties are exempt in this case.
According to Article 31b(3)(1) point (b) of the Excise Act shall be exempt from excise duty on taxable activities, the subject of which is gas products intended for navigation. The company's question concerned the possibility of applying this exemption where the counterparty uses fuel to test the ships manufactured or renovated (test shipping). In other words, the applicant wanted information as to whether the trial shipping could be regarded as a shipping resulting in exemption from excise duty.
The Director of National Tax Information issued an interpretation favourable to the company, recognising that excise duties are exempt in this case. However, the justification was much more general than the applicant’s own position:
”The applicant(...) shall not be obliged to examine whether the gas product sold to the final gas buyer will be used for the purposes of exemption(...) In addition, the applicant shall not be obliged to verify the declaration of use of the gas product by the purchaser of the gas product for exempt purposes.’
The above passage shows that the key element in this issue is the buyer’s declaration of intent to use excise goods for exempt purposes, the seller cannot be obliged to verify the accuracy of that declaration.
This interpretation can greatly facilitate the day-to-day activity of traders in goods exempt from excise duty due to their use. The adoption of an interpretation different from that presented could unnecessarily impede economic turnover by imposing too burdensome obligations on taxpayers.