The heirs of H. Barbier v Inspecteur van de Belastingdienst Particulieren/Ondernemingen buitenland te Heerlen.
Date: 2003-12-11
56.  It must be borne in mind, first, that although direct taxation falls within their competence, the Member States must none the less exercise that competence consistently with Community law (see   Schumacker  , cited above, paragraph 21; Case C-80/94   Wielockx   [1995] ECR I-2493, paragraph 16; and   Gschwind  , paragraph 20, and   Verkooijen  , paragraph 32, cited above).
57.  Second, Directive 88/361 brought about complete liberalisation of capital movements and to that end Article 1(1) thereof required the Member States to abolish all restrictions on such movements (Verkooijen  , paragraph 33). The direct effect of that provision was recognised by the Court in Joined Cases C-358/93 and C-416/93   Bordessa and Others   [1995] ECR I-361, paragraph 33.
58.  Investments in property such as those made within Netherlands territory by Mr Barbier, acting from Belgium, clearly constitute   "movements of capital"   within the meaning of Article 1(1) of Directive 88/361, as does the transfer of immovable property by its sole owner to a private company in which he holds all the shares, as well as the inheritance of that property.
59.  The rights conferred by that directive are not subject to the existence of other cross-border elements. The mere fact that the result of a national provision is to restrict movements of capital by an investor who is a national of a Member State on the basis of his place of residence is sufficient for Article 1(1) of Directive 88/361 to apply.
61.  Similarly, it is not relevant that the tax measure at issue in the main proceedings was adopted by the Member State of origin of the person concerned (see, to that effect, Case 115/78   Knoors  [1979] ECR 399, paragraph 24; Case C-61/89   Bouchoucha   [1990] ECR I-3551, paragraph 13; Case C-19/92   Kraus   [1993] ECR I-1663, paragraph 15; Case C-419/92   Scholz   [1994] ECR I-505, paragraphs 8 and 9; and Case C-107/94   Asscher   [1996] ECR I-3089, paragraph 32).
62.  As for the existence of a   "restriction"   within the meaning of Article 1(1) of Directive 88/361, national provisions such as those at issue in the main proceedings, which determine the value of immovable property for the purposes of assessing the amount of tax due when it is acquired through inheritance, are such as to discourage the purchase of immovable property situated in the Member State concerned and the transfer of financial ownership of such property to another person by a resident of another Member State. They also have the effect of reducing the value of the estate of a resident of a Member State other than that in which the property is situated who is in the same position as Mr Barbier.
71.  As regards the Netherlands Government's argument that the fact that the objective of selling the financial ownership of that immovable property was to avoid or delay the payment of a transfer tax should deprive the heirs of protection under Community law, suffice it to recall that a Community national cannot be deprived of the right to rely on the provisions of the Treaty on the ground that he is profiting from tax advantages which are legally provided by the rules in force in a Member State other than his State of residence.
75.  It follows from the foregoing that it is not necessary to examine the questions referred for a preliminary ruling in so far as they concern freedom of movement for persons. Suffice it to point out in that regard that the tax consequences in respect of inheritance rights are among the considerations which a national of a Member State could reasonably take into account when deciding whether or not to make use of the freedom of movement provided for in the Treaty.