Friday, 29 January 2010

When Is A Peep Show Really A Cinema?

In a rather bizarre VAT case at the European Court of Justice, the owner of a Belgian sex shop is attempting to argue that a coin-in-the-slot peep show counts as a cinema, which would then qualify for a reduction in VAT.

Under EU rules a cinema qualifies for a lower rate of VAT because they are identified has having a social or cultural purpose and in Belgian this reduces the rate from 21% to 6%.

The question posed to the ECJ is as follows:

Should a cubicle consisting of a lockable space where there is room for only one person and where this person can watch films on a television screen for payment, where this person personally starts the film projection by inserting a coin and has
a choice of different films, and during the time paid for can continually modify his/her choice of projected films, be regarded as a ‘cinema’ as referred to in the Sixth Council Directive
No 77/388/EEC (1) of 17 May 1977, Annex H, Category 7 (subsequently: Annex III, No 7, of Council Directive 2006/112/EC (2) of 28 November 2006)?
Now, a number of questions spring to mind; 1) Will the judges need to make a site visit, 2) why don't Belgians have the internet and, 3) are Pringles really cakes?

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