Judgment — ECLI:EU:C:1997:411
Date: 1997-09-17
Language of the case: Portuguese
Court formation: Fifth Chamber
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: Taxation;Free movement of goods;Value added tax;Customs Union;Internal taxation;Charges having an equivalent effect
Concepts: Prohibition of taxation on imported products in excess of that imposed on similar domestic products;Definition;Concept of value added tax and other similar taxes
Procedure: Reference for a preliminary ruling
Origin: Portugal

Summary of the Judgment 
1. Free movement of goods — Customs duties — Charges having equivalent effect — Internal 
taxation — Charge applicable to domestic and imported products hut benefiting the former 
solely or to a greater extent — Criteria for characterization 
(EC Treaty, Arts 9, 12 and 95) 
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SUMMARY — CASE C-347/95 
2. Tax provisions — Harmonization of Uivs — Turnover taxes — Common system of value 
added tax — Prohibition of the levying of other national charges which can be characterized 
as turnover taxes — Purpose — Meaning of 'turnover taxes' — Scope — Charge levied only 
on certain products — Excluded 
(Council Directive 77/388, Art. 33) 
1. A charge on the marketing of diary prod­
ucts levied without distinction on domes­
tic and imported products constitutes a 
charge having an effect equivalent to a 
customs duty, prohibited by Articles 9 
and 12 of the Treaty, if the revenue from 
it is intended to finance activities benefit­
ing only the taxed domestic products and 
if the resultant advantages fully offset the 
burden which the latter products bear; if 
those advantages only partly offset the 
burden borne by the domestic products, 
the charge constitutes discriminatory 
internal taxation prohibited by Article 95 
of the Treaty and must be reduced pro­
portionally. 
If the activities financed by the charge 
benefit domestic products and taxed 
imported products but the former obtain 
a proportionally greater advantage from 
them, the charge constitutes, to that 
extent, a charge having an effect equiva­
lent to a customs duty or discriminatory 
internal taxation, depending on whether 
the advantage accruing to the taxed 
domestic products fully or only partly 
offsets the burden which they bear. 
It follows that, with a view to determin­
ing how the charges on the marketing 
diary products are to be characterized in 
law, it is incumbent on the national court 
to consider: 
— whether the revenue from the charge is 
used for stabilization only of trade with 
the other Member States in the products 
which bear the charges; 
— •whether the institutional integration of 
the organizations representing the econ­
omic agents concerned and the imple­
mentation of the national and Commu­
nity aid schemes and financial and fiscal 
incentives in favour of the agri-foodstuffs 
industry and the distribution of agri-
foodstuffs, to which part of the revenue 
from the charges in question is appropri­
ated, benefit only domestic production or 
whether they benefit such production 
proportionally more than imported prod­
ucts. 
2. Since the aim pursued by Article 33 of 
the Sixth Directive (77/388) on the har­
monization of the laws of the Member 
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FAZENDA PÚBLICA v UCAL 
States relating to turnover taxes is to pre­
clude the introduction of taxes, duties and 
charges which, because they are levied on 
the movement of goods and services in a 
way comparable to value added tax, 
would compromise the functioning of the 
common system of value added tax, that 
provision does not preclude the levying 
of a charge which is applied only to cer­
tain products, is not proportional to the 
price of those products, is not charged at 
each stage of the production and distribu­
tion process and is not imposed on the 
added value of the goods. Since it displays 
none of the characteristics of value added 
tax, such a charge does not apply to the 
movement of goods and services in a 
manner comparable to value added tax. 
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