Are your supplies of blood plasma VAT exempt?

FinanzForum_2015_v2Recent developments related to blood plasma supplies in the EU and a comparison to the Swiss VAT treatment

Does human blood plasma fall within the scope of the VAT exemption applicable to blood?

  • In the European Union (EU)

On 5 October 2016, the Court of Justice of the European Union (CJEU) issued its decision to a German case (C-412/12, TMD) 1, in regards to whether the supply of blood plasma used for manufacturing of medicinal products should be VAT exempt or not.

With its decision CJEU, confirmed that although not explicitly listed in the EU VAT Directive’s 2 article, which provides for the VAT exemption of supplies of blood and human organs 3, the supply of plasma derived from human blood falls under the exemption, but only when the plasma is actually intended for direct therapeutic use.

Additionally, CJEU ruled that where the human blood plasma is intended to be used for the manufacture of medicinal products (i.e. plasma intended for industrial use) it should be subject to VAT. In this latter case, the question remains “Which VAT rate applies – the standard rate or the reduced rate?” The answer to this question depends on the national VAT rules of the country where the blood plasma sale, intra-community acquisition or import takes place.

  • In Switzerland

Swiss VAT law provides for a VAT exemption of supplies of blood and human organs 4; however, only the supplies of whole blood by persons possessing the required license are eligible to the VAT exemption.

Therefore, the supply of blood plasma, which is a component of human blood, but does not qualify as whole blood itself, is subject to Swiss VAT. Such an interpretation has been confirmed by the Federal Tax Authority (FTA) in their written guidelines.

The FTA has also confirmed that if the human blood plasma can qualify as “medication” 5, then the reduced VAT rate of 2.5% applies.


Implications your business should consider

As the CJEU’s decision becomes directly applicable legislation in all EU member states, it is expected that the CJEU’s decision would trigger changes to the current tax authorities’ practices in some countries, particularly with respect to the VAT treatment of blood plasma for industrial use.  This new EU legislation would mainly affect the specialized laboratories selling blood plasma, the pharmaceutical companies using plasma for the manufacture of medicinal products, as well as the intermediaries involved in the supply chain.

In view of the above, if you are involved in transactions with blood plasma (as either a supplier or a purchaser) it is recommended that you continue to monitor for local country developments triggered by the TMD case (C-412/12), and assess the impact of the CJEU’s decision in the light of both the EU and local legislation applying to your current supply chain.

We have provided a list of impacts/actions to consider, depending on your role in the plasma transaction (supplier/customer/intermediary), in the detailed PDF below:



Download the PDF here: Are your supplies of blood plasma VAT exempt?



If you would like to discuss the above in more detail and assess the implications for your business, please do not hesitate to contact us.

Patricia More
Partner, Indirect Tax
PwC Geneva
+41 58 792 95 07

Sandra Ragaz
Indirect Tax Leader for Pharma & Life Science in Switzerland
PwC Zurich
+41 58 792 44 69

Gergana Chalakova
Manager, Indirect Tax
PwC Geneva
+41 58 792 92 02

1 C-412/15 (TMD Gesellschaft für transfusionsmedizinische Dienste mbH v Finanzamt Kassel II – Hofgeismar)
2 Directive 2006/112/EC
3 The VAT exemption on blood is laid down in Article 132(1)(d) of Directive 2006/112/EC.
4 The VAT exemption on blood is laid down in Article 21(2)(5) of Swiss VAT Law of 12 June 2009.
5 Definition of “Medication” is provided with Article 49 of the Ordinance to the Swiss VAT Law