Source: European Parliament
The value added tax (VAT) Directive[1] provides for the taxation of supplies of services made by taxable persons for consideration.
However, as part of the derogations granted to Member States until the adoption of the definitive arrangements, Article 371 of the VAT Directive authorised Denmark, amongst other Member States, to continue to exempt the supply of services by authors, artists and performers but only those listed in Annex X, Part B, point (2), namely excluding assignments of patents, trademarks and other similar rights, and the granting of licences in respect of such rights, if the services in question were exempted in the respective Member States on 1 January 1978 and in accordance with the conditions applying on that date and have been applied continuously ever since.
Nevertheless, this is an option granted to Denmark which can decide to tax those services. Once it opts to tax, there is no possibility to revert to the previous exemption and Denmark will be obliged to continue to apply VAT on the services concerned.
It should be noted however that in some particular cases[2], the Court of Justice of the European Union has ruled that certain supplies of services by authors are not taxable transactions from a VAT point of view so there is no possibility for Member States to impose VAT on those amounts.