Press Release: Direct taxation: the Commission asks the Grand Duchy of Luxembourg to amend certain discriminatory provisions on inheritance tax

The European Commission officially asked on 24 June 2010 Luxembourg to amend its legislation on inheritance tax. This legislation stipulates additional conditions for non-resident heirs and, in particular, freezes their entire estates until they provide 'an additional guarantee'. This freeze rule does not apply to resident heirs and therefore constitutes a discriminatory practice. The Commission takes the view that this discriminatory arrangement is disproportionate, if not unjustified, and that it is contrary to the provisions of the Treaty on the Functioning of the European Union concerning the free movement of capital (Article 63).