Reference shall be made

Grattan received a VAT repayment from HMRC which included simple interest. The company appealed contending that under EU law it was entitled to compound interest.

The First-tier Tribunal referred the matter to the European Court of Justice (ECJ).

The Revenue appealed against the tribunal’s decision and claimed the Court of Appeal had previously noted in John Wilkins (Motor Engineers) Ltd v CRC [2011] STC 1371 that the interpretation of EU law and how it applied to compound interest on overpaid VAT had been settled.

The Upper Tribunal said the decision of any court to refer a question to the ECJ was a matter of the widest discretion for that court. The ECJ was entitled to choose to not accept the reference but that did not in itself mean the reference had been made incorrectly.

While it was true the question referred...