The restrictions on taxation under Article 110 of the TFEU : where can we draw a line?

Abstract

This dissertation analyses the CJEU’s approach towards Member States bypassing the provisions of Article 110 of the TFEU by using discriminatory forms of taxation against products manufactured elsewhere within the EU. It dissects the progress of the Court’s interpretation of said article over the years. A brief explanation of the internal market and the customs union is given with a distinction being made between Articles 28 and 30, (customs duties), and Article 110, which bans the introduction of internal taxes that are discriminatory to products coming from other EU countries, albeit all of them contribute to levelling the field. The boundaries of Article 110, as drawn by the CJEU, are critically examined in order to provide a clear idea of this Article’s workings as well as the CJEU’s interpretation throughout the years regarding issues related to said Article. The dissertation discovered that, notwithstanding national competence with regards to taxation, there is an understanding that any form of discrimination is prohibited unless justified and allowed by the CJEU. It was shown that although the CJEU does not have a strict rule of precedent, in most cases, it tends to interpret uniformly Article 110 TFEU, since it applies the same yardstick to the same articles. As a result the same broad outcome tends to be attained, with some notable exceptions where other considerations, such as for example regional economies and consumer patterns, impacted on the judgements. A more coherent approach by the CJEU is recommended. Finally, this work suggested possible further study to be carried out on the impact that preferential tax regimes in EU Member States have on the internal market, and whether and how tax harmonisation might contribute to a better functioning internal market.