Is a member of a statutory body liable for unpaid VAT?

Advocate General Juliane Kokott dealt with the question whether the general joint and several liability of the statutory body falls within the scope of the VAT Directive (on the grounds of the company's inability to pay its VAT debt). She also commented on whether national legislation can impose direct liability on a dishonest member of a managing board whose conduct leads to the company's inability to pay the tax properly.

She concluded that the direct liability of a managing director for unpaid tax of a third party is not contrary to the VAT Directive and is in line with the protection of the EU's financial interests. At the same time, she considered it essential to adopt national legislation aimed at discouraging directors from engaging in dishonest activities in order to achieve the collection of tax for the national budget. Under Czech legislation, this institution could be compared to the term "due managerial care" („péče řádného hospodáře").