In a ruling (C-552/15) delivered on Tuesday 19 September the European Court of Justice considered that a national regulation cannot compel residents to pay a vehicle registration tax for vehicles leased or hired in another member state, irrespective of the period of time the vehicle is used, without the possibility of residents being reimbursed, if the vehicle is used outside of the country of residence.
The Court therefore welcomes the Commission’s proceedings for failure to fulfil an obligation regarding infringements to the free provision of services. Residents in Ireland who lease or hire a vehicle in another member state, even for a limited period that is also known in advance, have to pay a tax that is as high as the tax applicable to vehicles that are permanently imported. This obligation could make this service costlier than when the lease or rental contract is concluded with a company established in Ireland.
The Court also considers that Irish legislation is disproportionate when it comes to tax reimbursement when the vehicle is mainly used in Ireland. The €500 amount charged for administrative costs has a dissuasive effect on taxpayers from filling in the reimbursement procedure. The Court believes that this is even more the case given that the charges relating to charges for registration cannot be made through deductions on the amounts due those who have the right of reimbursement. (Original version in French by Mathieu Bion)