Opinion of the Advocate General — ECLI:EU:C:2014:2375
Date: 2014-11-13
Language of the case: English
Subject matter: Free movement of workers
Procedure: Reference for a preliminary ruling
Origin: Netherlands

Summary — Judgment of the Court (Grand Chamber), 24 February 2015 1. Freedom of movement for persons — Workers — Equal treatment — Scope — Discrimination between non-resident workers — Included (Arts 20 TFEU and 21 TFEU) 2. Freedom of movement for persons — Workers — Equal treatment — Income tax — Tax advantage consisting in the flat-rate exemption of reimbursement of extraterritorial expenses, granted to workers from a Member State other than that of the place of work — Condition of residence at a certain distance from the border of the Member State of the place of work — Lawfulness (Art. 45 TFEU) 1. The freedom of movement of workers, first, prohibits a Member State from adopting a measure which favours workers residing in its territory if that measure ultimately favours that Member State’s own nationals, thereby giving rise to discrimination based on nationality. Secondly, having regard to the wording of Article 45(2) TFEU, which seeks to abolish all discrimination based on nationality between workers of the Member States, read in the light of Article 26 TFEU, that freedom also prohibits discrimination between non-resident workers if such discrimination leads to nationals of certain Member States being unduly favoured in comparison with others. (see paras 24, 25) 2. Article 45 TFEU must be interpreted as not precluding national legislation by which a Member State provides that workers who resided in another Member State prior to taking up employment in its territory are to be granted a tax advantage consisting in the flat-rate exemption of reimbursement of extraterritorial expenses in an amount up to 30% of the taxable base, on condition that those workers resided at a distance of more than 150 kilometres from its border, unless those limits were set in such a way that that exemption systematically gives rise to a net overcompensation in respect of the extraterritorial expenses actually incurred. The mere fact that limits are set concerning the distance in relation to the workers’ place of residence and concerning the ceiling of the exemption granted, taking as the starting point the border of the Member State where the place of work is located and the taxable base, respectively, even though this is necessarily approximate in nature, cannot, in itself, amount to indirect discrimination or an impediment to the free movement of workers. This is a fortiori so where the flat-rate rule operates in favour of the workers who benefit from it, in that it reduces significantly the administrative steps which those workers must undertake in order to obtain the exemption for the reimbursement of extraterritorial expenses. It is, however, an inherent aspect of the granting, on a flat-rate basis, of a tax advantage which is deemed to cover situations in which the material conditions governing entitlement to that advantage have been satisfied beyond doubt that there will be other situations in which, for a variety of reasons, those conditions have also been satisfied, with those situations also giving rise to a right to that advantage on production of appropriate proof. In that respect, while it is true that considerations of an administrative nature cannot justify a derogation by a Member State from the rules of EU law, Member States cannot be denied the possibility of attaining legitimate objectives through the introduction of rules which are easily managed and supervised by the competent authorities. (see paras 32-34, 36, operative part)