The Case

It was for each member state to determine and define the transactions to which could be applied a reduced rate of value added tax (VAT) under art12(4) of Council Directive (EEC) 77-388 (on the harmonisation of the laws of the member states relating to turnover taxescommon system of value added tax: uniform basis of assessment), until 31 December 1992, and under art28(2)(e) of that directive as amended by Council Directive (EEC) 92-77, as from 1 January 1993, subject to the necessity to respect the principle of neutrality of the VAT. The liberal professions mentioned in Annex F(2) to the Sixth Directive were activities which involved a marked intellectual character, required a high-level qualification and were usually subject to clear and strict professional regulation. In the exercise of such an activity, the personal element was of special importance and such exercise always involved a large measure of independence in the accomplishment of the professional activities.