Keywords
Summary

Keywords

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1. Freedom of movement for persons ° Workers ° Equal treatment ° Remuneration ° Taxes on income ° Repayment of excess tax in a system of retention at source ° Repayment of excess tax subject to a requirement that during the tax year the tax payer must have resided or occupied a salaried position within the national territory for a minimum period ° Not permissible

(EC Treaty, Art. 48(2); Council Regulation No 1612/68, Art. 7(2))

2. Member States ° Obligations ° Failure to fulfil obligations ° Maintenance of a national provision incompatible with Community law ° Justification based on the existence of administrative practices ensuring that the Treaty is applied ° Not permissible

Summary

1. A Member State which maintains in force provisions under which excess amounts of tax deducted from the wages or salaries of nationals of a Member State who resided in that State or occupied a salaried position there for only part of the tax year are to remain the property of the Treasury and are not repayable fails to fulfil its obligations under Article 48(2) of the Treaty and Article 7(2) of Regulation No 1612/68 on freedom of movement for workers within the Community.

Although the special situation of temporary residents may objectively justify the adoption of specific procedural arrangements to enable the competent tax authorities to determine the tax rate applicable to national income, it cannot justify the exclusion of that category of tax payer from entitlement, other than by means of a non-contentious procedure, to repayment of tax, where excess amounts of tax deducted are repayable as of right to permanent residents.

2. The incompatibility of national provisions with provisions of the Treaty, even those directly applicable, can be definitively eliminated only by means of binding domestic provisions having the same legal force as those which require to be amended.

Mere administrative practices, which by their nature are alterable at will by the authorities and are not given appropriate publicity, cannot be regarded as constituting the proper fulfilment of obligations under the Treaty, since they maintain, for the persons concerned, a state of uncertainty as regards the extent of their rights as guaranteed by the Treaty.