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A coffee capsule distributor has enquired whether it can deduct VAT on goods supplied alongside its products and whether this constitutes self-consumption. The DGT clarifies that if the goods are part of its regular business activity and are supplied as part of promotions (such as a 2-for-1 offer), the transaction is onerous and VAT is deductible; however, if the goods are acquired solely for gifting purposes, there is no right to deduction.
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