Press Release: VAT: The European Commission requests the United Kingdom to modify its legislation regarding the exemption for aircraft

On 25 June, 2009, the European Commission formally requested the United Kingdom to amend its legislation governing the VAT exemption for transactions related to aircraft, since it is based on criteria different from, and inconsistent with, those employed in the VAT Directive. The request was communicated in the form of a ‘reasoned opinion’ (second step of the infringement procedure provided for in Article 226 of the EC Treaty). If, within two months, the relevant national rules are not amended in order to comply with the reasoned opinion, the Commission may decide to refer the matter to the European Court of Justice.