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VAT treatment

The supply of goods in relation to which input tax was non-deductible is exempt.

This provision came into effect from 1 March 2000 as a result of an CJEU ruling in EC Commission v Italian Republic.

The relevant legislation (see above link) states that a supply of goods in relation to which the following conditions are satisfied, is exempt:

1. a)

   the person making the supply (‘the relevant supplier’), or any predecessor of his (ie where there has been a prior transfer of a going concern, or more than one such transfer), has incurred input tax on the goods