1. Tax provisions – Harmonisation of laws – Indirect taxes on the raising of capital – Capital duty charged on capital companies – Increase in share capital
(Council Directive 69/335, as amended by Directive 85/303, Arts 4(1)(c), and 5(1)(a))
2. Community law – Principles – Right to effective judicial protection
3. Tax provisions – Harmonisation of laws – Indirect taxes on the raising of capital – Capital duty charged on capital companies – Increase in share capital
(Council Directive 69/335, as amended by Directive 85/303)
1. Articles 4(1)(c) and 5(1)(a) of Directive 69/335 concerning indirect taxes on the raising of capital, as amended by Directive 85/303, must be interpreted as not precluding a Member State from identifying the registration of an instrument recording an increase in the capital of a company as the point at which the chargeable event for capital duty occurs, provided that there remains a connection between the levying of the duty and the actual contribution of assets to the company receiving them. If, at the time when such an instrument is executed, the actual contribution of assets has not been effected and it remains uncertain whether it will be effected, the Member State concerned cannot demand payment of capital duty until the contribution has become definite.
Thus, when it is apparent, following registration of the instrument recording an increase in capital but before payment of the duty, that, as a result of fraud, the contribution of assets has not in fact taken place at the time at the time of registration and it is clear that it will not take place, there can be no demand for payment of capital duty.
(see paras 38, 48, operative part 1)
2. The principle of effectiveness must be interpreted as precluding national legislation which restricts, before the tax courts, the means of proving that no contribution was in fact effected to increase the capital of a company, in accordance with the company’s resolution, to the production of a civil judgment that has become final declaring the registration null and void or annulling it, with the result that capital duty must in any event be paid and can be reimbursed only by means of the production of such a civil judgment, although under Directive 69/335 concerning indirect taxes on the raising of capital, as amended by Directive 85/303, no demand for payment of capital duty could be made given the absence of an actual contribution. Where the tax court is precluded from declaring, as an incidental matter, that the instrument recording an increase in capital is void and where, accordingly, an action before the tax courts to prevent recovery of capital duty is wholly ineffective – whereas in similar actions against other taxes the taxable person may be relieved of the obligation to pay a tax that is not payable – the exercise of the rights conferred by Directive 69/335 is rendered in practice impossible or, at the very least, excessively difficult.
(see paras 45-48, operative part 1)
3. Directive 69/335 concerning indirect taxes on the raising of capital, as amended by Directive 85/303, must be interpreted as not precluding a Member State from providing that the public officer who drafted or certified the instrument recording the increase in capital is jointly and severally liable for payment of capital duty, provided that the officer has the right to bring an action for indemnity against the company receiving the capital contribution.
Directive 69/335 does not seek to harmonise the arrangements for the collection of capital duty and does not, in principle, preclude the joint and several liability of the public officer, as such liability constitutes both a guarantee that the company receiving the increase in capital will fulfil its obligation to pay duty and a measure designed to simplify the charging of capital duty. However, making the public officer jointly and severally liable for payment of capital duty would go beyond what is necessary to meet the objectives cited above, if the public officer did not have the right to bring an action for indemnity against the company receiving the capital contribution.
(see paras 52-54, 56, 58, operative part 2)