Case C‑553/13

Tallinna Ettevõtlusamet

v

Statoil Fuel & Retail Eesti AS

(Request for a preliminary ruling from the Tallinna ringkonnakohus)

‛Reference for a preliminary ruling — Indirect taxation — Excise duties — Directive 2008/118/EC — Article 1(2) — Liquid fuel subject to excise duty — Sales tax — Concept of ‘specific purpose’ — Predetermined allocation — Organisation of public transport within the territory of a city)’

Summary — Judgment of the Court (Third Chamber), 5 March 2015

Tax provisions — Harmonisation of laws — Excise duties — Directive 2008/118 — Products subject to excise duty — National legislation imposing a tax on retail sales of liquid fuels — Tax intended to finance the organisation of public transport which is performed and financed independently of the existence of that tax — No specific purpose — Not permissible

(Council Directive 2008/118, Art. 1(2))

Article 1(2) of Directive 2008/118 concerning the general arrangements for excise duty and repealing Directive 92/12 must be interpreted as not permitting a tax, in so far as it is levied on retail sales of liquid fuel subject to excise duty, to be regarded as having a specific purpose within the meaning of that provision where that tax is intended to finance the organisation of public transport within the territory of the authority imposing the tax and where that authority is required to undertake and finance such transport irrespective of the existence of that tax, even if the revenue from that tax has been used solely for the purpose of performing that activity. That provision must therefore be interpreted as precluding national rules instituting such a tax on retail sales of liquid fuel subject to excise duty.

While the predetermined allocation of the proceeds of a tax to the financing by local authorities of powers transferred to them can constitute a factor to be taken into account for the purpose of establishing the existence of a specific purpose, such an allocation, which is merely a matter of internal organisation of the budget of a Member State, cannot, in itself, constitute a sufficient condition, since any Member State may decide to lay down, irrespective of the purpose pursued, that the proceeds of a tax are to be allocated to financing particular expenditure.

In order for the predetermined allocation of the revenue from a tax on excise goods to be regarded as indicating that the tax pursues a specific purpose within the meaning of Article 2(1) of Directive 2008/118, the tax in question must itself be directed at achieving the specific purpose referred to, and thus there must be a direct link between the use of the revenue and the specific purpose. In the absence of such a mechanism for the predetermined allocation of revenue, a tax on excise goods can be regarded as pursuing a specific purpose within the meaning of that provision only if it is designed, so far as its structure is concerned, and particularly the taxable item or the rate of tax, in such a way as to guide the behaviour of taxpayers in a direction which facilitates the achievement of the stated specific purpose, for example by taxing the goods in question heavily in order to discourage their consumption.

Even if it were accepted as established that, in substance, the sales tax, in so far as it is levied on liquid fuel subject to excise duty, has the purpose, by organising public transport efficiently, of protecting the environment and public health, and that expenditure for this purpose is not merely general expenditure which might be financed by means of revenue from taxes of any kind, the mere allocation of the revenue for the organisation of public transport cannot be regarded as enabling a direct link to be established between the use of the revenue from the tax concerned and those environmental and public health purposes.

(see paras 39, 41, 42, 45, 47, operative part)

Case C‑553/13

Tallinna Ettevõtlusamet

v

Statoil Fuel & Retail Eesti AS

(Request for a preliminary ruling from the Tallinna ringkonnakohus)

‛Reference for a preliminary ruling — Indirect taxation — Excise duties — Directive 2008/118/EC — Article 1(2) — Liquid fuel subject to excise duty — Sales tax — Concept of ‘specific purpose’ — Predetermined allocation — Organisation of public transport within the territory of a city)’

Summary — Judgment of the Court (Third Chamber), 5 March 2015

Tax provisions — Harmonisation of laws — Excise duties — Directive 2008/118 — Products subject to excise duty — National legislation imposing a tax on retail sales of liquid fuels — Tax intended to finance the organisation of public transport which is performed and financed independently of the existence of that tax — No specific purpose — Not permissible

(Council Directive 2008/118, Art. 1(2))

Article 1(2) of Directive 2008/118 concerning the general arrangements for excise duty and repealing Directive 92/12 must be interpreted as not permitting a tax, in so far as it is levied on retail sales of liquid fuel subject to excise duty, to be regarded as having a specific purpose within the meaning of that provision where that tax is intended to finance the organisation of public transport within the territory of the authority imposing the tax and where that authority is required to undertake and finance such transport irrespective of the existence of that tax, even if the revenue from that tax has been used solely for the purpose of performing that activity. That provision must therefore be interpreted as precluding national rules instituting such a tax on retail sales of liquid fuel subject to excise duty.

While the predetermined allocation of the proceeds of a tax to the financing by local authorities of powers transferred to them can constitute a factor to be taken into account for the purpose of establishing the existence of a specific purpose, such an allocation, which is merely a matter of internal organisation of the budget of a Member State, cannot, in itself, constitute a sufficient condition, since any Member State may decide to lay down, irrespective of the purpose pursued, that the proceeds of a tax are to be allocated to financing particular expenditure.

In order for the predetermined allocation of the revenue from a tax on excise goods to be regarded as indicating that the tax pursues a specific purpose within the meaning of Article 2(1) of Directive 2008/118, the tax in question must itself be directed at achieving the specific purpose referred to, and thus there must be a direct link between the use of the revenue and the specific purpose. In the absence of such a mechanism for the predetermined allocation of revenue, a tax on excise goods can be regarded as pursuing a specific purpose within the meaning of that provision only if it is designed, so far as its structure is concerned, and particularly the taxable item or the rate of tax, in such a way as to guide the behaviour of taxpayers in a direction which facilitates the achievement of the stated specific purpose, for example by taxing the goods in question heavily in order to discourage their consumption.

Even if it were accepted as established that, in substance, the sales tax, in so far as it is levied on liquid fuel subject to excise duty, has the purpose, by organising public transport efficiently, of protecting the environment and public health, and that expenditure for this purpose is not merely general expenditure which might be financed by means of revenue from taxes of any kind, the mere allocation of the revenue for the organisation of public transport cannot be regarded as enabling a direct link to be established between the use of the revenue from the tax concerned and those environmental and public health purposes.

(see paras 39, 41, 42, 45, 47, operative part)