Keywords
Summary

Keywords

Freedom of movement for persons – Workers – Equal treatment – Social advantages – Interim assistance granted to workers in the event of dismissal – Notional deduction, for workers resident and chargeable to tax in another Member State, of income tax theoretically due in the Member State of employment – Not permissible – Justification – None

(Art. 39 EC; Council Regulation No 1612/68, Art. 7(4))

Summary

Articles 39 EC and 7(4) of Regulation No 1612/68 on freedom of movement for workers within the Community preclude national legislation provided for in a collective agreement under which the amount of a social benefit such as a interim assistance by way of unemployment benefit granted to workers in the event of dismissal, which is paid by the Member State of employment to a worker who resides and chargeable to tax in another Member State, is calculated in such a way that the tax on wages payable in the Member State of employment is notionally deducted on determination of the basis of assessment of that benefit, even though, under a double taxation agreement, salaries, wages and analogous emoluments paid to workers not residing in that State are chargeable to tax only in the Member State in which such workers are resident.

The administrative difficulties for the Member State of employment which would stem from the application of different methods of assessment of that assistance depending on the place of residence of the person concerned and the budgetary consequences of the failure to take into account of national wage tax cannot justify that Member State’s failure to comply with its obligations under the Treaty.

(see paras 29-30, 37, operative part)