The EU Commission published yesterday a memo, two public consultations, created new web pages and a special group of experts. The Commission’s aim is to continue detecting taxes considered as obstacles to the single market, specially focusing on inheritance taxation. The importance of the single market was reminded through statistics showing that many EU citizens reside in an EU Member State other than their own (2.8% of the total EU population) and many EU citizens purchase goods from businesses based in another Member State (30% of EU citizen).
Then, the memo explains that the two public consultations launched were created to inform the Commission “about the actual tax problems encountered by individuals in cross-border situations and about any good practices that EU countries’ tax administrations apply […]”. One public consultation covers tax problems faced by citizens who are active cross-border and two new pages were created for the occasion in the existing web site “Your Europe”. These pages should provide further and more in-depth information about citizen’s rights.
The other public consultation deals with problems related to inheritance taxation. The Commission is following the same line as in 2011, the public consultation seems to be a follow up to the Commission’s comprehensive package on inheritance taxation issued that year. At the time, the Commission declared that in 3 years time, an evaluation report would be presented showing how the situation had evolved, and then, decide on this basis whether further measures would be necessary at national or EU level. Could today’s memo be a step forward towards the preparation of such evaluation report expected for 2014? Probably, because the information received shall be used to prepare a report “on the progress made in removing double taxation of inheritances in the EU”, the Commission wants to be aware of how the situation has evolved since 2011 and a group of experts was created yesterday, focusing particularly on inheritance taxation and on personal income taxation.
Six examples of real cross-border taxation problems figure in the Commission’s memo published yesterday. The examples deal with income tax, inheritance tax and difficulties with tax administrations. These examples would be a summary of the daily life of a tax adviser working in the EU. However, they serve the purpose of illustrating the kind of situations the Commission wants to be aware of. The tax issues are, among other, related to confusing double taxation treaties, translation requirements from member states that are expensive and the Portuguese stamp duty that is a transfer tax and not strictly an inheritance tax, so it cannot be credited against inheritance tax. Apparently the Commission wants to be aware of all kinds of situations relating to tax issues between different EU countries, not only Member State infringements but as well practices in the Member State’s administration that end up having the same effect as infringements. Should Member States consider this memo as a warning, reminding them that the Commission can use all sorts of means to detect infringements? And give tax payers the possibility to inform the Commission about their tax issues otherwise than before the CJEU? The answer shall probably be known in 2015 by the number of reasoned opinions received by Member States.
The Commission’s MEMO link: http://europa.eu/rapid/press-release_MEMO-14-278_en.htm?locale=en