A supply of insurance for a leased item and a supply of leasing itself are in principle distinct and independent supplies of services: a commentary on Case C-224/11 BGŻ Leasing

A long-running dispute between Polish leasing companies and the tax authorities as to whether leasing services supplied together with insurance for the leased item are to be treated as separate services or as one single composite leasing service seems to have been definitely settled by the ruling of the Court of Justice of the European Union in BGŻ Leasing delivered on 17 January 2013. Indeed, the Court of Justice, in its long awaited judgment, clearly and firmly rejected the arguments of the tax authorities that insurance is always ancillary to leasing, as being linked to the leased item, and must not be considered an independent and separate service. To the contrary, the Court ruled that: