Taxation of cross-border dividends in the European Union from past to future

Author (Person)
Series Title
Series Details Vol.19, No.2, April 2010, p74–84
Publication Date April 2010
ISSN 0928-2750
Content Type

Abstract:
The article aims at achieving consistency in the case law of the European Court of Justice (ECJ) on the taxation of dividends from the perspective of the Home State and that of the Host State. Based on the assumption that EU Member States are obliged to ensure the neutrality with regard to inbound dividends and outbound dividends, the author demonstrates that schedular tax systems are nowadays the ones that comply with EU Law while keeping its effective exercise of national taxing rights upon dividends.

The article also deals with the application of the pan-European approach (also known as ‘overall approach’), which, in the author’s view, is by far the most controversial current issue in relation to the taxation of dividends. The ECJ in Commission v. Italy correctly limited the application of the pan-European approach though without entirely removing the uncertainties that derive from its application to the taxation of cross-border dividends.

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