C-202/90

Mr President, State finance authorities. As a consequence, Members of the Court, the tax-collection activities entrusted to third parties were abolished. 3 However, local authorities, including communes, may assume responsibility for the collection of certain taxes and appoint collectors and enforcement agents for that purpose. 4 1. The questions referred to the Court for a preliminary ruling by the Tribunal Superior de Justicia de Andalucía concern the inter- pretation of Article 4(1), (4) and (5) of the Sixth Council Directive (77/388/EEC) of 17 May 1977 on the harmonization of the laws of the Member States relating to turnover taxes — Common system of value The rules applicable to tax collectors are added tax: uniform basis of assessment 1 contained in the abovementioned provisions (which I shall hereinafter refer to as 'the on the tax system, and in the Statute on the Sixth Directive')· The national court asks, in Organization of Tax Collection and Tax particular, whether under the provisions of Collectors, 5 provisions which give quite a the Sixth Directive the activities of a tax clear picture of the nature of the activities in collector must be regarded as dependent or question. On the one hand, tax collectors independent, and if independent, whether are appointed by local authorities following they must in any event be exempted from competitions held for that purpose; they value added tax since they are activities carry out their activities under the control engaged in as a 'public authority'. of the treasuries of the local authorities which appointed them and they enjoy some rights and prerogatives peculiar to civil servants. O n the other hand, however, tax collectors are required to provide a security of an amount fixed by the local authority on I shall summarize the basic facts of the case behalf of which they carry out their below and refer to the Report for the tax-collection activities; they appoint inde- Hearing for the details. pendently the auxiliary staff for their respective zones and, more generally, they organize their own undertakings and receive by way of remuneration a collection premium consisting of a proportion of the sums collected and a part of the 2. A recent reform of the Spanish tax supplements applied in the event of late system, 2 in essence, gave responsibility for payment. the collection of taxes — both State taxes and those of autonomous bodies — to the 3 — Royal Decree No 1451 of 27 November 1987 (BOE of 28 November 1987). 4 — Article 193 of the amended law on the rules governing * Original language: Iulian. local authorities, Royal Decree No 781 of 18 April 1986 1 — OJ L 145, p. 1. (BOE of 22 and 23 April 1986). 2 — Royal Decree No 1327 of 13 June 1986 (BOE of 2 July 5 — Decree No 3286 of 19 December 1969 (BO del M° Hac. 1986). of 30 December 1969).

It is for the national court to make such a finding, on the basis of the interpretation 4. With its first question, the national court given by the Court of Justice of the seeks an interpretation of Article 4(1) and provisions applicable in the present case, (4) of the Sixth Directive on VAT in order and consequently on the basis of the criteria to determine whether the activities of tax to be applied in order to determine whether collectors are carried out independently and or not a given activity is carried out inde- are therefore chargeable to tax. pendently.

6. With regard to working conditions, the Let me remind the Court first of all that first thing to be determined is whether the Article 4(1) defines a taxable person as worker in question forms a part of the anyone who 'independently' carries out any employer's organization — in the present economic activity, whatever the purpose or case the communal administration — or results of that activity. I would add that the whether he is free to organize his activity concept of an economic activity covers all independently, and to what extent. The activities of producers, traders and persons freedom to organize one's own work inde- supplying services. Article 4(4) goes on to pendently (to choose colleagues, the give a negative definition of the term structures necessary for the performance of 'independently' in that it excludes from the one's tasks and one's working hours), in

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conjunction with the fact of not forming In the present case the tax collector bears part of the organization of an undertaking the entire economic risk in so far as any or an administrative authority, are charac- taxes he fails to collect translates into a loss teristic features of an activity which is of earnings, which would not be the case if carried out independently. he were bound to the commune by a contract of employment since in that case he would still be paid whether or not he collected the taxes.

6 — Judgment in Case 235/85 Commission v Netherlands 7. By its second question, the national court [1987] ECR 1471, paragraph 14. 7 — See in this regard the judgment in Case 235/85, op cit., asks whether the activities carried out by a paragraph 14. tax collector are to be regarded as exempt

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from VAT pursuant to the first activity carried on by a private individual is subparagraph of Article 4(5) of the Sixth not exempted from VAT merely because it Directive since they are activities engaged in consists in carrying out acts falling within 'as a public authority'. Under that provision, the prerogatives of the public authority'. 9 bodies governed by public law are excluded That pronouncement is surely applicable to from tax in respect of the activities in which the present case. Moreover, the delegation they engage as public authorities. of tax collection to a third party, who provides such a service, for valuable consideration and on an independent basis, First of all, as the Court itself has pointed for the tax authority, produces a supply of out on a number of occasions, the Sixth services which, as such, is chargeable to tax Directive is characterized by its general pursuant to Article 4(1) of the Sixth scope and by the fact that all exemptions Directive on VAT. must be expressly provided for and precisely defined. In particular, it is clear from the provision in question that two conditions In short, even when, as in the present case, must be fulfilled in order for the exemption it is not disputed that a given activity is, in to apply: the activities must be carried out principle, part of the prerogatives of the by a body governed by public law and they public authority, the activity cannot be must be carried out by that body acting as a exempted under the first subparagraph of public authority. 8 Article 4(5) of the Sixth Directive when it is not carried out directly by a body governed by public law, but is entrusted to a supplier However, as the Court held in Case 235/85, of services who is a third party vis-à-vis the cited above, the foregoing means that 'an body itself.

(2) The first subparagraph of Article 4(5) of the Sixth Directive must be inter- preted as meaning that an economic activity which consists in carrying out acts falling within the prerogatives of the public authority are not excluded from the scope of VAT when they are not exercised directly by a body governed by public law but are entrusted to a supplier of services who constitutes a third party vis-à-vis the body itself.

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