Under the Sixth Directive, insurance transactions and financial services are exempt from VAT, which means that taxable persons carrying out those transactions are not entitled to deduct related input tax. However, where the recipients of those services are established outside the European Union, financial service providers are entitled to input tax deductions. The question arises whether or not non-EU banks are entitled to a refund of VAT where they render financial services to non-EU recipients. On the basis of a recent judgment of a court of first instance, that question must provisionally be answered in the affirmative for the Netherlands. In this article, the author analyses the views of the Dutch authorities and those of the party involved in the proceedings, and the decision of the court of first instance.