On June 8, 2023, the ECJ issued its decision in the case C-322/22 (Dyrektor Izby Administracji Skarbowej we Wrocławiu).
Context: Reference for a preliminary ruling – Principle of sincere cooperation – Principle of effectiveness – Tax levied by a Member State in breach of EU law – Breach established following a ruling of the Court of Justice – Right to be paid interest on the overpayment – National legislation limiting the right to the payment of interest to the period running until the thirtieth day following the publication of the ruling of the Court of Justice in the Official Journal of the European Union
Facts
- The appellant requested a refund of overpaid corporation tax and interest for the periods from collection to refund.
- The request was granted for the overpayments incurred in 2012 and 2013 but not for the overpayment in 2014, which was collected after the relevant date.
- The referring court questioned whether limiting the period during which interest on an overpayment may run was sufficient to make good the damage caused by the collection of tax not due and to implement the principle of sincere cooperation.
- The court noted that Article 78 § 5 of the Tax Code lays down identical rules for calculating interest on overpayments.
Questions
Do the principles of effectiveness, sincere cooperation and equivalence expressed in Article 4(3) [TEU], or any other relevant principle laid down in EU law, preclude a provision of national law such as Article 78 § 5(1) and (2) of [the Tax Code], which provides that interest on overpaid tax which is collected by a paying agent in a manner not consistent with EU law is not due to the taxable person for the period after the expiry of 30 days from the date of publication in the Official Journal [of the European Union] of the judgment of the Court of Justice … declaring that the collection of the tax is incompatible with EU law, where the request for a declaration of that overpayment was submitted by the taxable person after that time limit and the provisions of national law relating to the collection of the tax continue to be incompatible with EU law despite [the judgment in Emerging Markets]?
AG Opinion
None
Decision
The principle of effectiveness, in conjunction with the principle of sincere cooperation, must be interpreted as precluding a piece of national legislation which, when a request for a refund of an overpayment of tax is submitted more than 30 days after the publication in the Official Journal of the European Union of a ruling of the Court of Justice from which the finding that the tax at issue is contrary to EU law is derived, limits the running of the interest on the overpayment due to the taxable person concerned to the thirtieth day following that publication, or even excludes interest entirely in a situation where that overpayment was incurred by the taxable person after that thirtieth day.
Summary
- The referring court is asking whether national legislation that limits or excludes interest on a tax overpayment refund requested more than 30 days after the publication of a Court of Justice ruling, which found the tax to be contrary to EU law, violates the principles of equivalence, effectiveness, and sincere cooperation.
- The principle of sincere cooperation requires Member States to nullify the unlawful consequences of an infringement of EU law and to ensure that procedural rules for safeguarding individuals’ rights under EU law are no less favorable than those for similar domestic actions.
- Any person who has paid a tax in breach of EU law has the right to a refund and interest to compensate for the unavailability of that sum.
- These rights are based on the general principle of recovery of sums paid but not due.
- The breach of EU law can be any rule of primary or secondary law or a general principle of EU law.
- These rights can be invoked in any scenario where a national authority has imposed the payment of a sum of money on a person in breach of EU law.
Source
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