The Conseil d’Etat followed the position of the CJEU and repeated that VAT is due even when the transaction has not yet been performed, if all the elements relevant to the chargeable event (i.e. the future service) are already known and, in particular, that at the time of the advance payment, the goods and services are precisely determined. The Conseil d’Etat considered that the chargeable event relating to the service received by the passenger consists of the actual performance of the transport or of the expiration of the air carrier’s contractual obligations. As for the tax point, this occurs upon receipt of the payment of the price by the operator in charge of carrying out the transport service.
In respect of the nature of the obligation created by the contract, the Conseil d’Etat confirmed that the obligation created by a contract of transport entitles the customer to the right to be transported, exercisable at a time of his choosing for a one year period, and does not constitute a distinct obligation in respect of the reservation of the ticket or the transportation itself.
Finally, in terms of the nature of the payment made by the “no show” passenger, this is not aimed at compensating a loss. The Conseil d’Etat noted that the customer cannot be considered as having cancelled the contract where he had exercised his right to walk away from a refundable transport contract.
