Raffaele Talotta v Belgian State.
Date: 2007-03-22
16. The first point to be made is that, although direct taxation falls within their competence, the Member States must none the less exercise that competence consistently with Community law (Case C‑319/02 Manninen  [2004] ECR I‑7477, paragraph 19 and the case‑law cited).
17. 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 (Case C‑279/93 Schumacker  [1995] ECR I‑225, paragraph 26 and the case‑law cited).
18. Discrimination can arise only through the application of different rules to comparable situations or the application of the same rule to different situations ( Schumacker , paragraph 30, and Case C‑391/97 Gschwind  [1999] ECR I‑5451, paragraph 21).
19. In relation to direct taxation, the Court has accepted, in cases relating to taxation of the income of natural persons, that the situation of residents and the situation of non-residents in a given State are not generally comparable, since there are objective differences between them, both from the point of view of the source of the income and from the point of view of their ability to pay tax or the possibility of taking account of their personal and family circumstances ( Schumacker , paragraphs 31 to 34, Case C-80/94 Wielockx  [1995] ECR I‑2493, paragraph 18; and Case C‑107/94 Asscher  [1996] ECR I‑3089, paragraph 41). The Court has made it clear, however, that, in the case of a tax advantage which is not available to a non-resident, a difference in treatment as between the two categories of taxpayer may constitute discrimination within the meaning of the Treaty where there is no objective difference between the situations of the two such as to justify different treatment in that regard ( Schumacker , paragraphs 36 to 38, and Asscher , paragraph 42).
25. It cannot be accepted that the Member State of establishment may apply minimum tax bases solely to non‑resident taxpayers merely by reason of the fact that their tax residence is situated in another Member State, without depriving Article 52 of the Treaty of all meaning (see, by analogy, Case 270/83 Commission  v France  [1986] ECR 273, paragraph 18).
29. Moreover, it should be recalled that, in cases where the operations of a taxpayer are carried out in part in the territory of a Member State other than that in which he carries out his self-employed activity, a Member State may rely on Directive 77/799 in order to obtain from the competent authorities of the other Member State all the information enabling it to ascertain the correct amount of income tax, or all the information it considers necessary to ascertain the correct amount of income tax payable by a taxpayer under the legislation which it applies (see Case C‑422/01 Skandia and Ramstedt  [2003] ECR I‑6817, paragraph 42 and the case‑law cited).
31. That interpretation is in no way weakened by the Belgian Government’s observation that the minimum tax bases provided for in the national legislation at issue in the main proceedings are often more favourable to non‑resident taxpayers than the comparison‑based taxation applied to resident taxpayers. Even on the assumption that the Belgian tax system is more often favourable to non‑resident taxpayers, the fact remains that where that system proves disadvantageous for non-resident taxpayers, it results in unequal treatment by comparison with resident taxpayers and thus creates a hindrance to the freedom of establishment guaranteed by Article 52 of the Treaty (see, by analogy, Case C‑141/99 AMID  [2000] ECR I‑11619, paragraph 27 and the case‑law cited).
32. In those circumstances, legislation of a Member State, such as the rule resulting from Article 342(2) of the Income Tax Code 1992 and Article 182 of the Royal Decree of 27 August 1993, which lays down minimum tax bases only for non‑resident taxpayers constitutes indirect discrimination on grounds of nationality wi thin the meaning of Article 52 of the Treaty. In fact, even if such legislation provides for a distinction on the basis of residence, in that it denies non-residents certain tax benefits which are, conversely, granted to persons residing within the national territory, it is liable to operate mainly to the detriment of nationals of other Member States, since non-residents are in the majority of cases foreigners (see, by analogy, Schumacker , paragraph 28).
35. In that respect, it must be pointed out that the effectiveness of fiscal supervision constitutes an overriding requirement of general interest capable of justifying a restriction on the exercise of fundamental freedoms guaranteed by the Treaty (see, to that effect, Case C‑254/97 Baxter and Others  [1999] ECR I‑4809, paragraph 18 and the case‑law cited).