Skatteministeriet contra Bent Vestergaard.

• Jurisdiction: European Union
• Celex Number: 61998CJ0055
• ECLI: ECLI:EU:C:1999:533
• Date: 28 October 1999
• Court: Court of Justice (European Union)
• Procedure Type: Reference for a preliminary ruling
• Docket Number: C-55/98

Avis juridique important

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61998J0055

Judgment of the Court (Sixth Chamber) of 28 October 1999. - Skatteministeriet v Bent Vestergaard. - Reference for a preliminary ruling: Højesteret - Denmark. - Freedom to provide services - Income tax - Taxable income - Deduction of expenses for professional training courses - Distinction according to the location of the courses. - Case C-55/98.

European Court reports 1999 Page I-07641

Summary
Parties
Grounds
Decision on costs
Operative part

Keywords

Freedom to provide services - Restrictions - Deduction of expenditure related to professional training courses from taxable income - National legislation introducing a presumption that expenditure relating to courses organised in other Member States is non-deductible - Not permissible - Whether justified on grounds of public interest or by the need to preserve fiscal cohesion - No such justification

(EC Treaty, Art. 59 (now, after amendment, Art 49 EC))

Summary

$$Article 59 of the Treaty (now, after amendment, Article 49 EC) precludes a Member State from having rules which, for the purposes of determining taxable income, are based on the presumption that professional training courses held in ordinary tourist resorts located in other Member States involve such a significant tourism element that the costs of taking part in those courses cannot be treated as deductible operating costs, whereas there is no such presumption in the case of professional training courses held in ordinary tourist resorts located within the territory of that Member State.

Such rules, which make it more difficult to deduct costs relating to participation in professional training courses organised abroad than to deduct costs relating to such courses organised in the national territory involve a difference in treatment, based on the place where the service is provided, which cannot be justified by the need to preserve fiscal cohesion or by the need for effective fiscal supervision.

Parties

In Case C-55/98,

REFERENCE to the Court under Article 177 of the EC Treaty (now Article 234 EC) by the Højesteret (Supreme Court), Denmark for a preliminary ruling in the proceedings pending before that court between

Skatteministeriet

and

Bent Vestergaard

on the interpretation of Articles 6 and 59 of the EC Treaty (now, after amendment, Articles 12 EC and 49 EC),

THE COURT

(Sixth Chamber),

composed of: R. Schintgen (Rapporteur), President of the Second Chamber, acting as President of the Sixth Chamber, P.J.G. Kapteyn and G. Hirsch, Judges,

Advocate General: A. Saggio,

Registrar: H. von Holstein, Deputy Registrar,

after considering the written observations submitted on behalf of:

- the Skatteministeriet, by P. Biering, Advocate, Copenhagen,

- Mr Vestergaard, by T.V. Christiansen, Advocate, Åbyhøj,

- the Netherlands Government, by A. Bos, Legal Adviser at the Ministry of Foreign Affairs, acting as Agent,

- the Commission of the European Communities, by H.P. Hartvig, Legal Adviser, and H. Michard, of its Legal Service, acting as Agents,

having regard to the Report for the Hearing,

after hearing the oral observations of the Danish Ministry of Fiscal Affairs, represented by P. Biering, of Mr Vestergaard, represented by L. Henriksen, Advocate, Åbyhøj, and of the Commission, represented by H.P. Hartvig, at the hearing on 11 March 1999,

after hearing the Opinion of the Advocate General at the sitting on 10 June 1999,

gives the following

Judgment

Grounds

1 By order of 18 February 1998, received at the Court on 24 February 1998, the Højesteret (Supreme Court), Denmark, referred to the Court for a preliminary ruling under Article 177 of the EC Treaty (now Article 234 EC) two questions on the interpretation of Articles 6 and 59 of the EC Treaty (now, after amendment, Articles 12 EC and 49 EC).

2 The questions have been raised in proceedings between the Danish Skatteministeriet (Ministry of Fiscal Affairs) and Mr Vestergaard concerning the refusal of the Ministry to allow expenses incurred by Mr Vestergaard in taking part in professional training courses held abroad to be deducted as operating costs from the taxable income of the company Bent Vestergaard A/S, of which Mr Vestergaard is the sole shareholder.

Danish law

3 In Denmark, Article 4 of the Statsskatteloven (State Law Tax) No 149 of 10 April 1922 (hereinafter `the 1922 Law') provides that income, in the form of money or goods evaluable in money, is liable to tax.

4 Article 6 of the 1922 Law provides:

`(1) The following are to be deducted from taxable income:

(a) operating costs, that is expenses which, during the course of the year, have been incurred with a view to...