Legal tip 303. A new one on tax discrimination
Friday, June 18, 2010 @ 10:20 AM
It is ilegal that the taxman required by the Non-Resident Income a 15 percent on dividends received by a pension fund based in the European Union while the same Spanish funds were exempt, before the entry into force of Law 2 / 2010, prohibiting it, according to the Audiencia Nacional in three decisions issued on 31 March 2010.
Judge Gonzalez Calderon believes that by the simple fact of their residence for tax purposes these funds suffered discriminatory treatment because the return will always be a 15 percent lower than identical Spanish financial assets.
This discrimination on grounds of tax residency implies a limitation on the free movement of capital by nationality prohibited by the Treaty of the European Union, as pointed out by Case Law of the Justice Court of the European Communities.
Provision 56.1 of the EC establishes a prohibition to “all restrictions on capital movements between member States and between member States and third countries."
Finally, the Judge makes a reminder on the fact that the European justice Court stated that Spain breached provisions 56 and 40 of the agreement on the European Economic Area, when made a different treat to property earnings depending on whether taxpayers were residents or nonresidents.
Maria L. de Castro