Wrong tax number on a demand for duty

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What if the tax number, or an EORI number on a post clearance demand for duty is not correct. What does that mean for the validity of the demand? Early last month, the Dutch High Court ruled on that question. Following a post clearance inspection, Dutch customs issued a demand for duty. The name and address were correct, but the tax number, that was referred to, was that of another (related) company.

Dutch case law shows that the when a demand is incorrectly addressed, it generally does not result in a payment obligation. That is only different when the error is relatively small, so that there is no reasonable doubt about to whom the demand was issued.

In the case of early December, the Court of Appeal had ruled that – by making reference to  the tax number of another company –  one could indeed reasonably doubte about to whom demand was issued. The Court of Appeal specifically took into consideration that the tax number is so relevant in all communicating with the authorities.

I agree with the Court of Appeal. Especially when names of companies change, or companies merge, it is often the tax number that allows to determine which company it concerns. The Dutch High Court thought differently though. According to the High court the tax number is not an essential part of a post clearance demand for duty. Therefore the reference to the tax number of another company does not lead to nullity of the demand.

I think it is interesting to note once more that a post clearance demand for duty has both essential and non-essential parts and that an error in a non-essential part does not affect the validity of the demand. But then, an error in a non-essential part can of course mean that you’re having doubts about an essential part. Therefore I don’t know if the distinction between essential and non-essential parts of a demand for duty is such a good idea. It seems to me, that we should decide if there is reasonable doubt about to whom the demand is issued, based on all the information on the demand. That implies that it will be more difficult for a judge to make a decision, but that would probably be more fair to the individual case.

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