Keywords

Summary



Keywords

1. Citizens of the European Union – Right to move and reside freely within the territory of the Member States – Transfer tax on immovable property

(Arts 18 EC, 39 EC and 43 EC; EEA Agreement, Arts 28 and 31)

2. Citizens of the European Union – Equal treatment – Discrimination on grounds of nationality – Prohibition – National transfer tax on immovable property

(Arts 12 EC, 18 EC, 39 EC and 43 EC; EEA Agreement, Arts 4, 28 and 31)

Summary

1. A Member State that grants exemption from a tax on the transfer of immovable property solely to persons permanently resident in the national territory, whilst non-residents who intend to settle in that State in the future are not granted exemption from the tax, fails to fulfil its obligations under Articles 18 EC, 39 EC and 43 EC and under Articles 28 and 31 of the Agreement on the European Economic Area.

The rules regarding equal treatment forbid not only overt discrimination by reason of nationality but also all covert forms of discrimination which, by the application of other criteria of differentiation, lead in fact to the same result. That is true of a measure under which a distinction is drawn on the basis of residence or ordinary residence, in that that requirement is liable to operate mainly to the detriment of nationals of other Member States, inasmuch as persons who are not resident or ordinarily resident in the national territory are in the majority of cases foreigners. A requirement of permanent residence of that kind is not such as to justify the objectives, relied on by the Member State in question, of facilitating the purchase of a first home, preventing all property speculation and supporting middle or lower-income families and is not necessary for the purpose of restricting tax evasion and preventing abuse arising from circumvention of the objective of the exemption.

(see paras 45-46, 59, 63, operative part 1)

2. A Member State that grants, on certain conditions, exemption from a tax on the transfer of immovable property solely to its own nationals or to persons of that national origin fails to fulfil its obligations under Articles 12 EC, 39 EC and 43 EC and under Articles 4, 28 and 31 of the Agreement on the European Economic Area.

That different treatment as between its own nationals and nationals of other Member States who intend to settle in the Member State concerned, which is expressly and solely based on nationality, constitutes direct discrimination prohibited by those provisions. Objectives intended, first, both to make it easier for nationals of the Member State concerned who have emigrated and persons having the same national origin to purchase a home and to encourage their return, given that that Member State has experienced a sharp decrease in its population because of massive emigration abroad, and, second, to preserve links between persons who have emigrated and their country of origin do not establish that there are objective circumstances, independent of the nationality of the persons concerned, capable of justifying discrimination such as that resulting from the exemption, for their very foundation is the nationality of the persons concerned.

(see paras 69-71, 75, operative part 1)