Breakthrough verdict on the conditions of application of the 0% excise duty rate

The MDDP team was responsible for leading the case to a landmark ruling by the Supreme Administrative Court on the conditions for the application of the 0% excise duty rate.

The dispute concerned whether the requirement to issue an e-DD must always be met in order to apply the zero excise rate. The NSA confirmed that, despite the fact that such a premise stems from the regulations – in a situation where the same entity is a registered consignee and a consuming entity, this requirement is disproportionate and does not achieve the goal of enabling the tax authorities to monitor the destination of goods. The NSA also ruled that Poland may subject non-harmonised products to excise duty, but only if these requirements do not increase border crossing formalities in EU trade.

The judgment of the NSA confirmed that in specific circumstances – the conditions for the application of the 0% excise rate adopted in Polish regulations may infringe the principle of proportionality. The ruling is very important for all excise taxpayers and confirms that some of the conditions for the application of the zero excise rate contained in the Polish law may infringe EU law and should not be applied. The NSA judgment also confirms that tax authorities are obliged – even when issuing individual interpretations – to take EU law into account and, if necessary, refuse to apply national regulations that are incompatible with EU law.

The attorneys in the case were Agnieszka Kisielewska, Tomasz Michalik and Jakub Warnieło.

Judgment of the Supreme Administrative Court of 23.03.2023 ref. no. I FSK 66/23