The Influence of EU Law on Inheritance Taxation: Is the Intensification of Negative Integration Enough to Eliminate Obstacles Preventing EU Citizens from Crossing Borders within the Single Market?

A movement of relocation, or rather a geographical dispersion of people and assets, is increasingly appearing within the European borders, as well as beyond them. Recent studies have shown that many legal and practical obstacles deter European Union (EU) citizens from actually exercising their freedom to move across borders within the EU. Especially, several indicators prove that some difficulties still remain in the practice of inheritance in cross-border situations.

In respect of taxation, the problems consist mainly of double taxation and discriminatory tax treatment. These last ten years, the legislation of the Member States has progressively complied with EU law requirements and the difference of treatment between residents and non-residents is beginning to disappear completely. Today, the most important obstacles to the free movement of European citizens are due to the risk of double taxation of inheritances by several Member States. In this respect, the Court of Justice is powerless since its power of interpretation does not allow it to arbitrate between the Member States' taxation powers. Aware of this problem, the European Commission has recently adopted a set of measures destined to improve the coordination between the states legislations in order to fight the double taxation on inheritances.