D. v Inspecteur van de Belastingdienst/Particulieren/Ondernemingen buitenland te Heerlen.
Date: 2005-07-05
24. It should be noted first of all that an investment in real estate such as that made by Mr D. in the Netherlands constitutes a capital movement as referred to in Article 1 of Council Directive 88/361/EEC of 24 June 1988 for the implementation of Article 67 of the Treaty (OJ 1988 L 178, p. 5) and in the nomenclature of capital movements set out in Annex I to the directive. This nomenclature still has the same indicative value for the purposes of defining the notion of capital movements (see Case C-452/01 Ospelt and Schlössle Weissenberg  [2003] ECR I‑9743, paragraph 7). An investment of that kind falls within the scope of the rules relating to the free movement of capital that are laid down in Article 56 EC et seq.
26. In relation to direct taxes, the Court has accepted that the situations of residents and of non-residents are not, as a rule, comparable ( Schumacker , paragraph 31).
27. With regard to income tax, the Court has held that the situation of a resident is different from that of a non-resident in so far as the major part of his income is normally concentrated in the State of residence. Moreover, that State generally has available all the information needed to assess the taxpayer’s overall ability to pay, taking account of his personal and family circumstances ( Schumacker , paragraph 33).
29. The Court has nevertheless held that the position could be different where the non-resident receives no significant income in the Member State of residence and obtains the major part of his taxable income from an activity performed in the State of employment, with the result that the State of residence is not in a position to grant him the benefits resulting from the taking into account of his personal and family circumstances. There is then no objective difference between such a non-resident and a resident engaged in comparable employment, such as to justify different treatment as regards the taking into account for taxation purposes of the taxpayer’s personal and family circumstances (see, in particular, Schumacker , paragraphs 36 and 37, and Case C-169/03 Wallentin  [2004] ECR I-6443, paragraph 17).
30. The Court has thus allowed a Member State to make grant of a benefit to non-residents subject to the condition that at least 90% of their worldwide income must be subject to tax in that State (Case C-391/97 Gschwind  [1999] ECR I-5451, paragraph 32).
33. Second, a person liable to wealth tax as a rule holds the greater part of his assets in the State where he is resident. As the Court has already stated, that Member State is usually where the taxable person’s personal and financial interests are centred (see Case C-234/01 Gerritse  [2003] ECR I‑5933, paragraph 43).
50. The Court noted in Case C-336/96 Gilly  [1998] ECR I-2793, at paragraph 23, that apart from Convention 90/436/EEC on the elimination of double taxation in connection with the adjustment of profits of associated enterprises (OJ 1990 L 225, p. 10), no unifying or harmonising measure for the elimination of double taxation had yet been adopted at Community level and that the Member States had not yet concluded any multilateral convention to that effect under Article 293 EC.
52. As the Court has already pointed out, the Member States are at liberty, in the framework of those conventions, to determine the connecting factors for the purposes of allocating powers of taxation (see Case C‑307/97 Saint-Gobain ZN  [1999] ECR I-6161, paragraph 57). The Court has also accepted that a difference in treatment between nationals of the two Contracting States that results from that allocation cannot constitute discrimination contrary to Article 39 EC (see Gilly , cited above, paragraph 30).
54. The scope of a bilateral tax convention is limited to the natural or legal persons referred to in it.
56. The Court has thus held that, in the case of a double taxation convention concluded between a Member State and a non-member country, the national treatment principle requires the Member State which is party to the convention to grant to permanent establishments of non-resident companies the benefits provided for by that convention on the same conditions as those which apply to resident companies (see Saint‑Gobain ZN , cited above, paragraph 59).
61. The fact that those reciprocal rights and obligations apply only to persons resident in one of the two Contracting Member States is an inherent consequence of bilateral double taxation conventions. It follows that a taxable person resident in Belgium is not in the same situation as a taxable person resident outside Belgium so far as concerns wealth tax on real property situated in the Netherlands.
62. A rule such as that laid down in Article 25(3) of the Belgium-Netherlands Convention cannot be regarded as a benefit separable from the remainder of the Convention, but is an integral part thereof and contributes to its overall balance.