Brussels, 23/03/2007 (Agence Europe) - The Commission has decided to take Italy to the Court of Justice of the European Union and to send a reasoned opinion to Sweden and Poland as part of three different procedures for infringement of European fiscal legislation.
“Condono”. The Italian 2004 Finance Act extended to 2002 a tax amnesty (“condono”) established by the 2003 Finance Act. Under this legislation, the Italian tax authorities renounce the right to subsequently control value added tax (VAT) not paid for a given period when a taxpayer resident in Italy chooses to make use of the amnesty; this can be done through a fixed sum if no return was filed, or through a sum equivalent to 2% of the VAT that would have been payable for that period. The Commission believes that this measure contravenes the VAT Directive and has taken Italy to the Court of Justice (case C-132/06). According to the Commission, the measures put in place in Italy go beyond the margin of discretion enjoyed by the member states for adjusting their controls on the basis of their resources. This time the referral of Italy to the Court relates to the extension of the measure to the year 2002.
Audio books. Through a reasoned opinion, the Commission has formally invited Sweden to modify its rules on the reduced rate of VAT imposed on intra-Community imports and supplies of audio books. Currently this rate is 6%, whereas the Commission believes that it should be set at the normal rate of 25% because there is no legal justification for applying a reduced rate. The VAT Directive does not consider audio books to be medical equipment intended to alleviate or treat disability, for the exclusive personal use of the disabled.
Taxation of electricity. Poland is to receive a reasoned opinion inviting it to bring its system for the taxation of electricity into line with European legislation. Under directive 2003/96/EC, excise duty on electricity is chargeable at the moment of supply by the distributor or redistributor, making them liable to pay tax. Poland - which benefited from a transitional period up to 1 January 2006 - places the tax liability on the producer. Its response in December 2006 to an initial letter of formal notice did not satisfy the Commission. (mb)