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Health center is not automatically exempt from sales tax


BFH: Desired treatment without a medical reason is taxable

Services provided by a "health center" are not automatically exempt from VAT. Only diagnostic examinations and treatments based on them are favored, as the Bundesfinanzhof (BFH) in Munich decided in a decision published on Wednesday, March 6, 2019 (file number: XI R 29/17). However, desired treatments without a medical reason are subject to VAT.

It rejected a health center with 200 beds in Hesse. In terms of trade law, it is classified as a private clinic; in any case, there was no supply contract with the statutory health insurance companies in the years between 2009 and 2011.

Regardless of a medical report, the customers were able to decide on the length of their stay and book certain services at a “fixed price”. Corresponding “stay packages” were advertised in catalogs, magazines and on the Internet and could also be booked online.

A medical examination was carried out at the beginning of the stay. However, it was only checked whether health restrictions spoke against certain measures and applications. A schedule was then created in accordance with the booking and the wishes of the customer. A final medical consultation was only planned in part of the “service packages”.

The health center believes that its income is exempt from VAT as medical services. The tax office, however, set sales tax.

Rightly so, as the BFH decided after the Hessian Finance Court.

According to the law, “Hospital treatment and medical treatment including diagnostics, diagnosis, preventive care, rehabilitation, obstetrics and hospice services” are tax-free. The basic prerequisite for this is "that the sales are related to treatments that serve a therapeutic purpose". The aim of the EU law on which the German regulations are based is to reduce the costs of medical treatment. In the border area there were measures "that can serve both healing purposes and merely to improve the general state of health".

After this, the requirements for tax exemption were not met, the BFH decided in its now published decision of January 11, 2019. The treatments were carried out “regardless of a medically diagnosed clinical picture”. Therefore, "a therapeutic purpose" is missing.

The health center unsuccessfully referred to the idea of ​​primary prevention and self-help and the goal of improving general health. BFH emphasized that preventive health services are only exceptionally exempt from VAT if they are carried out as part of a medical treatment. This is not the case here. mwo / fle

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