Council Implementing Decision (EU) 2025/539 of 18 March 2025 authorising Estonia to apply a special measure derogating from Article 26(1), point (a), and Articles 168 and 168a of Directive 2006/112/EC on the common system of value added tax

By way of derogation from Articles 168 and 168a of Directive 2006/112/EC, Estonia is authorised to limit to 50 % the right to deduct the value added tax on expenditure on passenger cars not wholly used for business purposes where that expenditure covers the purchase, leasing, intra-Community acquisition or importation of passenger cars not wholly used for business purposes, as well as on expenditure related to the maintenance and repair of such cars and to the purchase of fuel for them.

By way of derogation from Article 26(1), point (a), of Directive 2006/112/EC, Estonia is authorised not to treat as a supply of services for consideration the use for non-business purposes of a passenger car included in the assets of a taxable person’s business, where that car has been subject to a limitation authorised under Article 1 of this Decision.

1 This Decision shall apply only to passenger cars with a maximum authorised weight not exceeding 3500 kilograms and having not more than eight seats in addition to the driver’s seat.

2 This Decision shall not apply to the following categories of passenger cars: (a) cars purchased for resale, hire or lease; (b) cars used for the transportation of passengers for a fee, including taxi services; (c) cars used for the provision of driving lessons.

1 This Decision shall take effect on the date of its notification.

2 This Decision shall apply from 1 January 2025 until 31 December 2027.

3 Any request for the extension of the authorisation provided for in this Decision shall be submitted to the Commission by 31 March 2027 and shall be accompanied by a report which includes a review of the percentage set out in Article 1.

This Decision is addressed to the Republic of Estonia.