Welcome to the first edition of Taxwatch.

The 6th-century philosopher Heraclitus wrote that 'there is nothing constant but change'. The world of indirect tax bears this statement out with refinements to our understanding and interpretation of indirect tax legislation. This is particularly evident from the number of judgments coming from the European Court of Justice (ECJ) in recent weeks and months.

In several instances, the cases have raised questions about how we treat VAT in Ireland. In particular, the recent ECJ cases could have significant impact on the insurance outsourcing industry (Arthur Andersen case), entitlement to recover VAT incurred in respect of share issues (Kretztechnik), the validity of planning structures (Halifax) and the liability of supplies of standard software and the subsequent customisation of this software (Levob).

We have addressed a number of the VAT issues in the 'News Feature' section of this publication and in previously released VAT Alerts (see 'Publications' section below for more details).

With an increased number of cases listed referred to the ECJ for consideration, there is no doubt that more changes are ahead. We will continue to bring you business focused information on these changes in our VAT Alerts and in future editions of Taxwatch.

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