Type: Judgment

Authority: European Authorities: Euopean Union' Court of Justice

Date: 07/13/2016

Subject: The Court affirmed that EU Law does not preclude national legislation under which a procedure for withholding tax at source is applied to the income of financial institutions that are not resident in the Member State in which the services are provided, whereas the income received by financial institutions that are resident in that Member State is not subject to such withholding tax, provided that the application of the withholding tax to the non-resident financial institutions is justified by an overriding reason in the general interest and does not go beyond what is necessary to attain the objective pursued. On the contrary, according to the Court, EU Law precludes national legislation, such as that at issue in the main proceedings, which, as a general rule, taxes non-resident financial institutions on the interest income received within the Member State concerned without giving them the opportunity to deduct business expenses directly related to the activity in question, whereas such an opportunity is given to resident financial institutions

Parties: Brisal e KBC Finance Ireland

Classification: Freedoms - Art. 15 Freedom to provide services

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