Hugo Leonardo is the author of the article “VAT on Voluntary Carbon Credits”, published by the International Bureau of Fiscal Documentation (IBFD), in which he examines some of the key legal and practical issues surrounding the VAT treatment of transactions involving the acquisition and disposal of Voluntary Carbon Credits (VCCs).
Against the backdrop of the rapid expansion of the carbon credit market and the absence of harmonised rules across the European Union, the article explores the challenges this emerging reality poses to the application of existing VAT legislation. In particular, the author addresses the continuing interpretative uncertainties regarding the tax treatment of these transactions and assesses whether the current VAT framework is capable of accommodating the specific features of this evolving market.
The analysis also considers the potential need for legislative or interpretative clarification at EU level, contributing to the broader discussion on how VAT systems can adapt to new instruments associated with the climate transition and sustainability objectives.
The article was published by the IBFD.
