Parties
Grounds
Decision on costs
Operative part
Keywords
1. Preliminary rulings Questions to which the answer may be clearly deduced from the Court's existing case-law Application of Article 104(3) of the Rules of Procedure
(Rules of Procedure of the Court of Justice, Art. 104(3))
2. Tax provisions Harmonisation of laws Indirect taxes on the raising of capital Directive 69/335 Capital duty and tax having the same characteristics as such a duty Definition Tax on companies' net assets Excluded Tax levied also on the part of the net assets consisting solely of a company's capital as disclosed annually in the balance sheet Irrelevant
(Council Directive 69/335, Arts 4 and 10)
Parties
In Joined Cases C-279/99, C-293/99, C-296/99, C-330/99 and C-336/99,
REFERENCE to the Court under Article 234 EC by the Commissione Tributaria di Primo Grado di Trento, Italy, for a preliminary ruling in the proceedings pending before that court between
Petrolvilla & Bortolotti SpA
and
Direzione delle Entrate per la Provincia di Trento (C-279/99),
between
Energy Service Srl
and
Direzione delle Entrate per la Provincia di Trento (C-293/99),
between
Pavarini Components SpA
and
Direzione delle Entrate per la Provincia di Trento (C-296/99),
between
Hôtel Bellavista di Litterini Valter e Nadia Snc,
Cattoni Hôtel Plaza di Cattoni Gian Carlo e C. Snc,
Villa Luti Srl
and
Ufficio Imposte Dirette di Tione di Trento,
Centro di Servizio delle Imposte Dirette e Indirette di Trento (C-330/99),
and between
Tumedei SpA
and
Centro di Servizio delle Imposte Dirette e Indirette di Trento (C-336/99),
on the interpretation of Council Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital (OJ, English Special Edition 1969 (II), p. 412), as amended by Council Directive 85/303/EEC of 10 June 1985 (OJ 1985 L 156, p. 23),
THE COURT (First Chamber),
composed of: M. Wathelet, President of the Chamber, P. Jann (Rapporteur) and L. Sevón, Judges,
Advocate General: L.A. Geelhoed,
Registrar: R. Grass,
after informing the court which made the reference that the Court proposes to give its decision by reasoned order in accordance with Article 104(3) of its Rules of Procedure,
after inviting the parties to the main actions, the Member States and the institutions referred to in Article 20 of the EC Statute of the Court of Justice to submit any observations they may have in that regard,
after hearing the Advocate General,
makes the following
Order
Grounds
1 By orders of 29 April (C-330/99), 13 May (C-336/99) and 10 June 1999 (C-279/99, C-293/99 and C-296/99), received at the Court on 26 July (C-279/99), 5 August (C-293/99), 6 August (C-296/99), 2 September (C-330/99) and 10 September 1999 (C-336/99), the Commissione Tributaria di Primo Grado di Trento (Tax Court of First Instance, Trento) referred to the Court for a preliminary ruling pursuant to Article 234 EC a question on the interpretation of Council Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital (OJ, English Special Edition 1969 (II), p. 412), as amended by Council Directive 85/303/EEC of 10 June 1985 (OJ 1985 L 156, p. 23) (hereinafter the Directive).
2 That question was raised in the course of proceedings between certain companies established in Italy and the Italian tax authorities concerning applications for reimbursement of sums paid by way of tax on companies' net assets.
3 The Directive is aimed in particular at achieving harmonisation of the factors involved in the fixing and levying of capital duty in the Community, by means of the elimination of tax obstacles which interfere with the free movement of capital (see Case C-4/97 Nonwoven v Direzione Regionale delle Entrate per la Toscana [1998] ECR I-6469, paragraph 3).
4 Article 4(1) of the Directive specifies the transactions which must be subject to capital duty and Article 4(2) lists other transactions which may be subject to that duty.
5 Article 10 of the Directive specifies the transactions in respect of which no taxes may be charged apart from capital duty. These include the transactions referred to in Article 4.
6 Decree-Law No 394 of 30 September 1992 (Gazzetta Ufficiale della Repubblica Italiana, No 230 of 30 September 1992) introduced into the Italian tax system a tax on companies' net assets. Those subject to this tax include capital companies, cooperative companies, mutual insurance companies, public and private bodies which are not companies but which have as their exclusive and/or main purpose the exercise of commercial activities, as well as natural persons engaged in activities generating corporate revenue (see Nonwoven, paragraph 9).
7 The basis of assessment of the tax consists of the net assets, as set out in the end-of-year balance sheet, less the profits for that year, the assets comprising various elements, including in particular subscribed capital, even if not yet paid up (see Nonwoven, paragraph 10).
8 The applicants in the main proceedings were required to pay the tax on companies' net assets in respect of various periods of assessment in the years 1992 to 1997. After applying to the tax authorities for reimbursement of the tax, and failing to receive any response from that authority, they raised proceedings in the national court between 30 July 1997 and 17 June 1998 against the implied decisions of rejection of their applications.
9 On 27 October 1998, the Court of Justice gave its judgment in Nonwoven, in which it ruled that the Directive did not preclude the levying on capital companies of a tax such as the tax on companies' net assets.
10 In the national court, the applicants in the main proceedings contend that that answer, given to a question formulated in general terms, raises issues of detail as regards the inclusion, specifically, of subscribed capital within the basis of assessment of the tax. They maintain that in so far as it extends to subscribed capital the tax in question constitutes a duty on capital, or, at least, has an effect equivalent to a new duty on capital, contrary to the prohibition laid down by the Directive.
11 Having regard to the submissions made to it, the Tax Court of First Instance, Trento, decided to stay the proceedings before it and to refer the following question, formulated in identical terms in each of five orders, to the Court for a preliminary ruling:
Is it compatible with Community law, and in particular with Directive 69/355/EEC, to tax over a period of years at the rate of 0.75% per annum pursuant to Decree-Law No 394 of 30 September 1992 that part of the net assets consisting solely of a company's capital disclosed annually by the balance sheet which has already borne capital duty at the rate of 1%?
12 By order of the President of the Court of 21 September 1999, the five actions were joined for the purposes of the written and oral procedure and of giving judgment.
13 It must be observed at the outset that the answer to the question referred may be clearly deduced from the Court's existing case-law, and thus the Court may give its decision by reasoned order pursuant to Article 104(3) of the Rules of Procedure.
14 At paragraph 21 of its judgment in Nonwoven, the Court decided that a tax on assets, such as that at issue in the main proceedings, does not presuppose any transaction involving the movement of capital or assets and thus does not correspond to any of the taxable transactions mentioned in Article 4 of the Directive, to which Article 10 refers.
15 At paragraph 22 of the same judgment, the Court held that, while it is true that the base of the tax at issue takes into account the amount of capital subscribed, which must or may be subject to capital duty, that capital is only one component of a company's net assets; the tax base consists of the sum of several accounting items, including reserves or funds as well as profits carried over from previous years and losses, both those of the current financial year and those of previous financial years.
16 Having regard to these matters, the Court ruled, at paragraph 24 of its judgment in Nonwoven, that a tax such as that at issue in the main proceedings is neither a capital duty nor a tax having the same characteristics as such a duty.
17 It is plain from the grounds of that judgment that the decision took account of the inclusion of company capital in the basis of assessment of the tax.
18 It may therefore be clearly taken from the Nonwoven judgment that there is no need to extract company capital from the basis of assessment and to treat it differently from the other elements of the latter.
19 In those circumstances, the question referred may be answered by stating that the Directive does not preclude the levying on capital companies of a tax such as the tax on companies' net assets, even where the tax relates to that part of the net assets which consists of the company's capital as recorded annually in the balance sheet.
Decision on costs
Costs
20 The costs incurred by the Italian Government and by the Commission, which have submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main action, a step in the proceedings pending before the national court, the decision on costs is a matter for that court.
Operative part
On those grounds,
THE COURT (First Chamber),
in answer to the question referred to it by the Commissione Tributaria di Primo Grado di Trento by orders of 29 April, 13 May and 10 June 1999, hereby rules:
Council Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital, as amended by Council Directive 85/303/EEC of 10 June 1985, does not preclude the levying on capital companies of a tax such as the tax on companies' net assets, even where the tax relates to that part of the net assets which consists of the company's capital as recorded annually in the balance sheet.
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