Flashback on ECJ cases C-365/02 (Lindfors) – Tax levied before registration or bringing into use of a vehicle

On July 15, 2004, the ECJ issued its decision in the case C-365/02 (Lindfors).

Context: Directive 83/183/EEC – Transfer of residence from one Member State to another – Tax levied before registration or bringing into use of a vehicle

This is a case on the importation of personal property, some of them going back to the time before the abolition of fiscal frontiers.

Article in the EU VAT Directive

Article 1 of Directive 83/183 provides:

1. Every Member State shall, subject to the conditions and in the cases hereinafter set out, exempt personal property imported permanently from another Member State by private individuals from turnover tax, excise duty and other consumption taxes which normally apply to such property.

2. Specific and/or periodical duties and taxes connected with the use of such property within the country, such as for instance motor vehicle registration fees, road taxes and television licences, are not covered by this Directive.’

Facts

After residing in other Member States, Ms Lindfors moved permanently to Finland, and in connection with that transfer of residence imported into Finland on 4 August 1999 a private vehicle which was her personal property, which she had brought into use in the Netherlands in 1995 after buying it in Germany.
In a tax assessment of 4 August 1999, the Hangon tullikamari (Hanko Customs Board) (Finland) granted Ms Lindfors a tax reduction of FIM 80 000 and fixed the car tax payable by her at FIM 16 556, plus value added tax of FIM 3 642, making a total of FIM 20 198 (approximately EUR 3 400).
Ms Lindfors brought proceedings against that decision in the Helsingin hallinto-oikeus (Helsinki Administrative Court) (Finland). She considered that autovero constituted a consumption tax prohibited under Article 1(1) of Directive 83/183.
Her action was dismissed. The Helsingin hallinto-oikeus held that, as a tax connected with the registration or use in traffic of a vehicle in Finland, autovero was to be regarded as a specific tax connected with the use of property within the country within the meaning of Article 1(2) of Directive 83/183, such a tax being outside the scope of that directive.
Ms Lindfors sought leave from the Korkein hallinto-oikeus to appeal against the decision of the Helsingin hallinto-oikeus.

Questions

Is Article 1 of Directive 83/183 … to be interpreted as meaning that car tax (autovero) charged under the Law on Car Tax (Autoverolaki) on a vehicle imported into Finland from another Member State in connection with a transfer of residence is a consumption tax within the meaning of Article 1(1) of the directive, or is it a specific duty or tax connected with the use of such property within the country within the meaning of Article 1(2)?

AG Opinion

Article 1 of Council Directive 83/183/EEC of 28 March 1983 on tax exemptions applicable to permanent imports from a Member State of the personal property of individuals is to be interpreted as meaning that it does not preclude the levying of a tax such as car tax imposed under the Autoverolaki which is levied on vehicles imported from one Member State into another Member State in connection with a transfer of residence.

Decision

Article 1 of Council Directive 83/183/EEC of 28 March 1983 on tax exemptions applicable to permanent imports from a Member State of the personal property of individuals must be interpreted as not precluding, in connection with a transfer of residence of the owner of a vehicle from one Member State to another, a tax such as that laid down by the Autoverolaki (1482/1994) (Law on Car Tax) from being charged before the registration or bringing into use of the vehicle in the Member State to which residence is transferred. However, having regard to the requirements deriving from Article 18 EC, it is for the national court to ascertain whether the application of national law is capable of ensuring that, as regards that tax, that owner is not placed in a less favourable situation than that of citizens who have been permanently resident in the Member State in question and, if necessary, whether such a difference of treatment is justified by objective considerations independent of the residence of the persons concerned and proportionate to the legitimate aim pursued by national law.

Summary

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