Elisabeth Jacquier, née Casarin v Directeur Général des Impôts.
Date: 1995-11-30
15 It suffices to note in this respect that, as the Advocate General observes in point 20 of his Opinion, products are similar for the purposes of the first paragraph of Article 95 of the Treaty if their characteristics and the needs which they serve place them in a competitive relationship. It is not impossible that a sharp rise in the tax on vehicles in the last three bands might have a deterrent effect on consumers, leading them not to buy vehicles in the highest band (23 CV and over) and to opt for a domestic model in the 17-18 CV or 15-16 CV tax band, provided that their minimum requirements regarding performance, size and comfort are met.
17 It should be noted to begin with that the Court held in Case 112/84 Humblot v Directeur des Services Fiscaux [1985] ECR 1367, paragraphs 12 and 13, that as Community law stands at present the Member States are at liberty to subject products such as cars to a system of road tax which increases progressively in amount depending on an objective criterion, such as cylinder capacity, provided that that system of taxation is free from any discriminatory or protective effect.
21 A system of taxation cannot be regarded as discriminatory solely because only imported products, in particular those from other Member States, come within the most heavily taxed category (Case 140/79 Chemial Farmaceutici v DAF [1981] ECR 1, paragraph 18, and Case C-132/88 Commission v Greece [1990] ECR I-1567, paragraph 18).
22 To determine whether the increase in the progression coefficient of the differential tax above the 18 CV threshold has a discriminatory or protective effect, it must be examined whether that increase may deter consumers from purchasing vehicles with a fiscal horsepower of over 18 CV, which are all of foreign manufacture, to the benefit of vehicles of domestic manufacture.
23 If the increase in the coefficient for vehicles with a fiscal horsepower of over 18 CV does indeed deter some consumers from buying such vehicles, those consumers will choose a model in the tax band immediately below, the 17-18 CV band, or even, as the Advocate General notes in point 27 of his Opinion, a model in the 15-16 CV band.
24 The 15-16 CV and 17-18 CV tax bands, however, include both imported vehicles and vehicles of domestic manufacture. In the 17-18 CV band, it is apparent from the documents in the case that the vehicles are nearly all of foreign manufacture and that domestic manufacturers have a market share of only about 5% of total car sales in that band. In the 15-16 CV band, while the majority of vehicles sold are indeed of domestic manufacture, firstly, consumers do nevertheless have a wide choice of imported vehicles in that band, and secondly, as appears from paragraph 6 of this judgment, the progression coefficients for the 15-16 CV and the 17-18 CV bands are the same, in round figures, so that consumers who are looking for a vehicle from the top of the range will not thereby be induced to purchase a vehicle in the 15-16 CV band.
25 In a system such as that at issue in the present case, therefore, it does not appear that the increase in the progression coefficient can have the effect of favouring the sale of vehicles of domestic manufacture.