Seminar on taxation

A full-day seminar entitled "European Court of Justice Case-Law on the Interpretation of EU Law with respect to Taxation - an update" is being organised by the Institute of Financial Services Practitioners on Monday, December 4, at the Westin Dragonara Resort, St Julian's.

Chris Curmi will be introducing the seminar. Guest speaker Christiana HJI Panayi, a lecturer in tax law at the Queen Mary University of London, will outline the general principles of EC Tax Law and Commission actions as well as analysing recent and pending ECJ decisions regarding expenses, losses, emigration, subsidiaries and branches, abuse, CFCs, Thin Capitalisation, dividend and third countries, among others.

Select ECJ case-law relevant to income tax practice in the Maltese context will then be addressed by Dr Juanita Brockdorff and Dr Silvio Cilia. This seminar follows the November 2003, November 2005, and March 2006 updates.

The development of the ECJ's case-law illustrates the court's contribution to creating a legal environment for European citizens by protecting the rights which community legislation confers on them in various areas of their daily life.

Although taxation is central to national sovereignty, in the EU's single market, member states need to work together and not strike out in different directions on tax policy. This is explicitly recognised by the Treaty in the area of indirect taxation and rather more implicitly for direct taxation.

The EC Treaty, under Article 93, specifically provides for the EU Council of Ministers, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, to adopt provisions for the harmonisation of member states' rules in the area of indirect taxation (principally Value Added Tax and Excise Duties) because indirect taxes may create an immediate obstacle to the free movement of goods and the free supply of services within an internal market. They may also create distortions of competition. A large number of directives and some regulations have been agreed in this area on the basis of that Article.

As far as other taxes are concerned, Article 94 provides for the Council, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the Economic and Social Committee, to adopt provisions for the approximation of such laws, regulations or administrative provisions of the member states that directly affect the establishment or functioning of the common market.

Rulings by the Court of Justice spell out in greater detail how the ban on tax discrimination under Article 90 of the EC Treaty applies and define a number of important concepts inherent in tax directives.

In the area of direct taxation, the ECJ has consistently held that, in the absence of harmonisation, taxes on personal income fall within the competence of the member states but they must respect the fundamental EC Treaty principles on the four freedoms (free movement of workers, services and capital, and the freedom of establishment). In particular, there must be no discrimination on the basis of nationality.

The struggle for compromise between national sovereignty in the area of taxation on the one hand, and the need for harmonisation for purposes of the Internal Market on the other hand remains. For further information or to book your place for the seminar, contact Dr Bernice Gauci at the IFSP on 2548-5200 or by e-mail: info@ifsp-malta.com.

Bookings are limited and will be made on a first-come-first-served basis.