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EU Commission raps countries over tax

Thursday 30 September 2010 - by Will Henley

Germany, Greece and Belgium have today been ordered by the European Commission to drop tax regimes which it alleges are “discriminatory”.

The commission accuses the governments of contravening EU-wide tax rules on offsetting losses against profits, withholding taxes on dividends, and collecting capital gains on collective investment vehicles.

In a statement issued today, the commission demands quick action, saying: “In the absence of satisfactory responses within two months, the commission may refer these member states to the EU's Court of Justice.”

In Germany, the inability of foreign companies to offset losses against profits was questioned. Though fully taxable under national law, foreign companies cannot benefit from the same fiscal regime as German companies. "[This is] considered to be discriminatory," said the statement.

Greece was told that it was in violation of a European Community agreement with Switzerland on savings income taxation by applying a withholding tax of 10 per cent on dividends paid by Greek subsidiaries.


Belgium was held up over its decisions to both set up a beneficial tax regime on gifts and legacies granted to Belgian public bodies and to not tax capital gains on redemption of shares of collective investment vehicles established outside the EU.


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