Keywords

Summary



Keywords

1. Freedom of establishment — Freedom to provide services — Direct life assurance — Directive 2002/83 — Applicable fiscal arrangements — Member State of the commitment — Definition

(European Parliament and Council Directive 2002/83, Arts 1(1)(g), 32 and 50)

2. Freedom of establishment — Freedom to provide services — Direct life assurance — Directive 2002/83 — Taxes on premiums — Taxation in the Member State of the commitment — Assurance policyholder having transferred his habitual residence to a Member State other than that in which the contract was concluded — Collection of the tax by the Member State of habitual residence of the person assured — Lawfulness

(European Parliament and Council Directive 2002/83, Art. 50(1))

Summary

1. See the text of the decision.

(see paras 38-40)

2. Article 50 of Directive 2002/83 concerning life assurance must be interpreted as not precluding a Member State from collecting an indirect tax on life assurance premiums paid by policyholders who are natural persons having their habitual residence in that Member State, when the assurance contracts concerned were taken out in another Member State in which those policyholders had their habitual residence on the date the contracts were taken out.

A ‘dynamic’ interpretation of the concept of the ‘Member State of the commitment’, referred to in Article 50(1) of Directive 2002/83, enables the objectives of preventing double taxation and distortions of competition pursued by that directive to be better achieved, while also being compatible with the general objective of that directive relating to the completion of the internal market in direct life assurance, in particular, from the point of view of the freedom to provide services.

First of all, by providing that every assurance contract is to be subject exclusively to the indirect taxes and parafiscal charges on assurance premiums in the Member State of the commitment, Article 50(1) is intended to confer on a single Member State the competence to tax life assurance premiums, in order thereby to eliminate double taxation of those premiums. In this connection, there is nothing to suggest that the competence conferred has to remain unchanged throughout the term of the contract. In the case of indirect taxes on assurance premiums, the chargeable event for tax purposes is not the conclusion of the assurance contract, but rather the payment of the assurance premiums. It follows that the Member State with competence to tax the assurance premiums should be the Member State with whose territory the policyholder has a connection on the date of payment of the premiums in the form of habitual residence.

Next, by linking the competence over taxation of assurance premiums to the habitual residence of the policyholder, Directive 2002/83 is intended to ensure that the supply of life assurance contracts available to a policyholder is, irrespective of the Member State of establishment of the assurance undertaking, subject to the same tax treatment and that, consequently, the choice of the provider of life assurance services is not influenced by considerations relating to taxation of those premiums. Assurance undertakings are, accordingly, not placed at an advantage or a disadvantage by the more or less favourable taxation in their home Member State and can compete on an equal footing with assurance undertakings established in the Member State of habitual residence of the policyholder. Only a ‘dynamic’ interpretation of Article 50(1) of Directive 2002/83 makes it possible to ensure that equality and to prevent distortions of competition by ensuring that the same tax treatment is applied to an existing contract and to any new contract.

Lastly, such an interpretation is compatible with the general objective of Directive 2002/83, which is intended to achieve the completion of the internal market in direct life assurance, from the point of view both of the right of establishment and of the freedom to provide services in the Member States, to make it easier for assurance undertakings with their head office in the European Union to cover commitments situated within the European Union and to make it possible for policyholders to have recourse not only to assurers established in their own Member State, but also to assurers which have their head office in the European Union and are established in other Member States.

(see paras 48, 49, 52, 53, 58, 59, 62, 68, 69, operative part)