This unique book investigates the extent tot which a taxpayer may invoke the
freedom of movement within the Community in order to avoid national direct
taxes. A Member State's right to protect its taxing authority and tax
jurisdiction may collide with a Union citizen's right to free movement under
Community law. The author shows what at the national level is viewed as
abuse may often be viewed from an EC law perspective as invoking
the Treaty freedoms.
As his starting point, the author describes relevant Community law as it
stands at present, whereby Member States are exclusively authorized to
determine the types, tax bases, rates, and procedural aspects of direct taxes.
He goes on to examine the possibilities offered by primary EC law to
cross-border taxpayers who seek to avoid tax, basing his presentation on an
in-depth analysis of the tax and non-tax case law of the Court of Justice of
the European Communities. Among the issues raised in the course of the
analysis are the following:
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applicability of each of the freedoms of the citizen, of goods, of workers, of
establishment, of services, and of capital;
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tests entailed by Community law: the economic activity test, the artificiality
test, and the substance test;
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the extent to which holding and letterbox companies may invoke the freedom of
movement; and
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the fiscal cohesion justification.
The author describes the implicit concept of avoidance that the Court
apparently uses by examining its tax and non-tax decisions in avoidance-like
cases, thus offering a valuable discussion of whether the anti-abuse doctrine
development by the Court is a principle of Community law. In its thorough
investigation of a major current manifestation of the emblematic conflict
between state taxing authority and personal freedom, this thoughtful and
well-researched analysis will be of great value to tax professionals,
officials, and academics not only on Europe but wherever this fundamental
problem in tax law applies.
Contents: Preface. About the Author. List of Abbreviations. 1.
Introduction. The questions to be answered. Delimitation of the research.
Method: The Court's three-step test. 2. Access to the EC Treaty Freedoms
(Step One). Introduction. Invoking the freedom of movement. Access to the
EC Treaty freedoms and tax avoidance: Conclusions. 3. Restriction of the EC
Treaty Freedoms (The second Step). Introduction. Prohibition of
discrimination and prohibition of restrictions under the freedom of movement.
Prohibition of measures without distinction (first concept of freedom).
Discrimination and the prohibition of restrictions versus anti-(tax) avoidance
measures. Restrictions of the EC Treaty freedoms and tax avoiders:
Conclusions. 4. Prevention of Tax Avoidance as a Justification of
Restrictions of the EC Treaty Freedoms (The Third Step). Introduction.
Exceptions to the EC Treaty freedoms. Prevention of abuse, avoidance. The need
to safeguard the cohesion of the tax system¿ as compelling reason of general
public interest. Prevention of tax avoidance as justification: Conclusion.
5. Tax Avoidance and the EC Treaty Freedoms. Summary. Conditions under
which tax avoidance may be prevented. Reflections on the future: Are Member
States being forced to harmonise their tax laws because of the limited
possibilities of preventing tax avoidance? Index.