The European Court stated that the notion of a property to has the independent significance, irrespective of the qualification this notion by the domestic legislation of the State. In this connection European Court observed that disputes arising out from the refusal to refund VAT, to arise not with regard to the specific amount of the VAT, but with regard to the applicant’s specific right to refund VAT. The European Court considers that the applicant had the reasonable right to refund VAT, at observance of the requirements established by the domestic tax legislation. Despite the fact that a specific demand for tax refund can be the subject of tax audits by tax authorities and in respect of that can be raised objections by tax authorities.
The European Court recognized that the right to obtain of the VAT tax privilege is a property right protected by the Protocol No.1 to the Convention for the Protection of Human Rights and Fundamental Freedom (the Article 1).
Based on the above, the Court awarded the compensation in the amount of EUR 25000 for damages.
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