AS TO THE ADMISSIBILITY OF
Application No. 21663/93
by Catharine Maria Petronella FETERIS-GEERARDS
against the Netherlands
The European Commission of Human Rights (Second Chamber) sitting
in private on 13 October 1993, the following members being present:
MM. S. TRECHSEL, President
H. DANELIUS
G. JÖRUNDSSON
J.-C. SOYER
H.G. SCHERMERS
Mrs. G.H. THUNE
MM. F. MARTINEZ
L. LOUCAIDES
J.-C. GEUS
M.A. NOWICKI
I. CABRAL BARRETO
Mr. K. ROGGE, Secretary to the Chamber
Having regard to Article 25 of the Convention for the Protection
of Human Rights and Fundamental Freedoms;
Having regard to the application introduced on 1 March 1993 by
Catharine Maria Petronella FETERIS-GEERARDS against the Netherlands and
registered on 15 April 1993 under file No. 21663/93;
Having regard to the report provided for in Rule 47 of the Rules
of Procedure of the Commission;
Having deliberated;
Decides as follows:
THE FACTS
The applicant is a Dutch national, born in 1957 and residing at
Leiden, the Netherlands. Before the Commission she is represented by
her husband, Mr. M.W.C. Feteris, a tax lawyer practising in Leiden.
The facts of the case, as submitted by the applicant, may be
summarised as follows.
On 1 June 1988 the applicant and her husband bought a house
together, each of them acquiring 50% of the ownership. The applicant
and her husband are married with a marriage settlement
(huwelijksvoorwaarden) and have no marital community of property. The
applicant and her husband contracted each 50% of the necessary mortgage
loan and related costs. The costs related to the transaction were paid
from their joint bank account. According to their marriage settlement
each of the spouses is eligible to pay 50% of these costs. Under the
Income Tax Act (Wet op de Inkomstenbelasting) these costs, after
balancing them with a legally fixed amount relating to presumed income
from the use of the house (huurwaardeforfait), are deductible from the
taxable income. The total deductible costs were 18.524 Dutch guilders
for the couple.
Pursuant to Section 5 of the Income Tax Act the total deductible
amount of 18.524 guilders had been deducted from the taxable income of
the spouse with the highest income, which in this case is the
applicant's husband. This was advantageous for the couple as a whole,
since the applicant's husband's higher income is taxed at a higher
rate. The advantage for the applicant's husband thus obtained was
higher than the advantage the applicant would have obtained if 50% of
the deductible amount had been deducted from her own taxable income.
The advantage thus obtained for the couple as a whole was 2.782 Dutch
guilders. The applicant's marriage settlement does not, however,
contain any obligation that such tax advantages should be divided
between the spouses.
On 31 August 1989 the Inspector of Direct Taxes (Inspecteur der
Directe Belastingen) issued an assessment of the social security
contributions (aanslag premieheffing volksverzekeringen) the applicant
had to pay on the basis of her taxable income in 1988, as social
security contributions are calculated on the basis of taxable income.
The Inspector did not deduct the applicant's part of the costs related
to the purchase of the house from her taxable income in 1988.
In respect of the calculation of the contributions under the
general social security schemes (volksverzekeringen), i.e. the General
Old Age Pension Act (Algemene Ouderdomswet - hereinafter referred to
as "AOW") and the General Widow's and Orphan's Pension Act (Algemene
Weduwen- en Wezenwet - hereinafter referred to as "AWW"), there was no
advantage of the transfer of the applicant's part of the tax deductible
costs to her husband since he already pays the maximum AOW/AWW
contribution as his income is higher than the maximum income to be
taken into account for the calculation of the AOW/AWW contributions.
If the applicant's part of the tax deductible costs had been deducted
from her taxable income, she would have obtained a reduction of 1.185
Dutch guilders in respect of the AOW/AWW contributions to be paid.
By decision of 28 November 1989 the Inspector of Direct Taxes
rejected the applicant's objection against the assessment of her social
security contributions. Her subsequent appeal to the Court of Appeal
(Gerechtshof) of The Hague was rejected on 6 May 1991.
The applicant's appeal to the Supreme Court (Hoge Raad) was
rejected on 4 November 1992. Insofar as the applicant complained that
the application of Section 5 of the Income Tax Act constituted
discriminatory treatment contrary to Article 26 of the International
Covenant on Civil and Political Rights and was contrary to Article 4
para. 1 of the Directive of the Council of the European Communities of
19 December 1978, no. 79/7/EEC concerning the gradual implementation
of the principle of equal treatment between men and women in the field
of social security, the Supreme Court considered that the applicant did
not dispute that the application of Section 5 of the Income Tax Act
leads only in few relatively exceptional cases to the result that a
married woman, living with her spouse, has to pay more social security
contributions than the case would have been when that Section would not
have been applied, and that this is a consequence of the legislator's
creation of a simple regulation by deriving the income for the
calculation of social security contributions from the taxable income.
The Supreme Court upheld the Court of Appeal's reasoning that the
legislator, on the assumption that cohabiting spouses fiscally form an
economic unit and for the sake of simplicity and practical feasibility,
could reasonably opt for an income tax system where a tax deductible
amount is transferred to the spouse with the higher income. Taking into
account that the legislator also wished to keep the calculation of the
social security contributions simple and practical and therefore
stipulated in the AOW and the AWW that the income for the calculation
of the social security contributions should be derived from the taxable
income in a simple manner, the Supreme Court found this to be an
objectively justifiable aim. It therefore found no discrimination on
the basis of sex.
Under Section 81 of the Civil Code - book 1 (Burgerlijk Wetboek -
boek 1) spouses owe each other faithfulness, aid and support and are
under the obligation to provide each other with "the necessary" (het
nodige). According to Section 84 of the Civil Code - book 1 this
includes the obligation to contribute to the costs of their common
household each according to income. As to the latter obligation,
spouses are at liberty to make different arrangements through a
marriage settlement.
COMPLAINT
The applicant complains under Article 14 of the Convention in
conjunction with Article 1 of Protocol No. 1 that the distinction made
between spouses in the Dutch rules on the imposition of AOW and AWW
contributions constitutes a discriminatory treatment on the basis of
income, civil status and indirectly on the basis of sex, since this
distinction leads to an unjustified disadvantage for the spouse with
the lowest personal income, who did in fact pay tax deductible costs.
The applicant submits that statistics over 1988 show that in the
Netherlands in more than 95% of the cases the husband is the spouse
with the highest income.
THE LAW
The applicant complains under Article 14 of the Convention in
conjunction with Article 1 of Protocol No. 1 (Art. 14+P1-1) that the
distinction made between spouses in the Dutch rules on the imposition
of AOW and AWW contributions constitutes a discriminatory treatment on
the basis of income, civil status and indirectly on the basis of sex.
Article 14 (Art. 14) of the Convention reads as follows:
"The enjoyment of the rights and freedoms set forth in this
Convention shall be secured without discrimination on any
ground such as sex, race, colour, language, religion,
political or other opinion, national or social origin,
association with a national minority, property, birth or
other status."
Article 1 of Protocol No. 1 (P1-1) provides as follows:
"Every natural or legal person is entitled to the peaceful
enjoyment of his possessions. No one shall be deprived of
his possessions except in the public interest and subject
to the conditions provided for by law and by the general
principles of international law.
The preceding provisions shall not, however, in any way
impair the right of a State to enforce such laws as it
deems necessary to control the use of property in
accordance with the general interest or to secure the
payment of taxes or other contributions or penalties."
The Commission recalls that Article 14 (Art. 14) of the
Convention has no independent existence, but supplements the other
provisions of the Convention and the Protocols. Article 14
(Art. 14) safeguards individuals, placed in similar situations, from
discrimination in the enjoyment of the rights and freedoms set forth
in those other provisions. A measure which as such could be in
conformity with the normative provision may therefore nevertheless
violate that provision taken together with Article 14 (Art. 14) of the
Convention if it is applied in a discriminatory manner. A distinction
is discriminatory if it "has no objective and reasonable
justification", that is, if it does not pursue a "legitimate aim" or
if there is not a "reasonable relationship of proportionality between
the means employed and the aim sought to be realised" (cf. No.
10491/83, Dec. 3.12.86, D.R. 51 p. 41 at p. 50).
The Commission considers that the payment of social security
contributions can be regarded as the payment of a contribution within
the meaning of the second paragraph of Article 1 of Protocol No. 1
(P1-1) and an obligation to pay such contributions falls within the
scope of this provision. Article 14 (Art. 14) of the Convention
therefore applies.
The Commission notes that the calculation of the above
contributions is based on taxable income. It finds no indication of
discrimination as regards the application of this principle in the
applicant's case.
The Commission further notes that prior to the calculation of the
social security contributions, when the applicant's taxable income was
determined, the spouses' total tax deductible amount of 18.524 guilders
was deducted from the taxable income of the applicant's husband
pursuant to Section 5 of the Income Tax Act. This was advantageous for
their household as a whole, since the financial advantage thus obtained
was higher than the advantage the applicant and her husband would have
obtained individually if the applicant's part of the tax deductible
costs had not been transferred to her husband and 50% of the deductible
amount had been deducted from their individual taxable incomes.
As the duty to pay tax falls within the scope of Article 1 of
Protocol No. 1 (P1-1), Article 14 (Art. 14) of the Convention also
applies in this respect (Eur. Court H.R., Darby judgment of 23 October
1990, Series A no. 187, p. 12, para. 30).
The Commission considers that in the determination of the taxable
income of the applicant and her husband there is a difference in
treatment between spouses based on difference of income. The question
therefore arises whether or not this difference in treatment has an
objective and reasonable justification.
The Commission notes that the Dutch rules in respect of the
transfer of tax deductible amounts between spouses apply to men and
women alike. It further observes that the applicant is married and that
her marriage settlement does not contain any obligation that fiscal
advantages should be divided between the spouses.
Having regard to all the rights and obligations which
characterise marriage, such as reflected by, inter alia, Section 81 of
the Dutch Civil Code, noting that Article 8 (Art. 8) of the Convention
protects family life, and given the Contracting States' wide margin of
appreciation in the field of taxation as to the aims to be pursued and
the means by which they are pursued, the Commission accepts that a
married couple may in some respects be treated as an economic unit,
also taking into account the desirability to keep rules concerning the
determination of taxable income simple and practical. It notes that the
application of Section 5 of the Income Tax Act entails a higher
financial advantage for the couple as a whole as regards income tax and
that spouses are free to choose their mutual financial arrangements by
way of a marriage settlement. In these circumstances the Commission is
satisfied that there was an objective and reasonable justification for
the transfer of tax deductible amounts to the spouse with the higher
income.
The Commission therefore cannot find that the transfer of the
applicant's part of the tax deductible amount to her husband
constituted a discriminatory treatment contrary to Article 14
of the Convention in conjunction with Article 1 of Protocol No. 1
(Art. 14+P1-1).
It follows that the application is manifestly ill-founded within
the meaning of Article 27 para. 2 (Art. 27-2) of the Convention.
For these reasons, the Commission, by a majority,
DECLARES THE APPLICATION INADMISSIBLE.
Secretary to the Second Chamber President of the Second Chamber
(K. ROGGE) (S. TRECHSEL)
Full & Egal Universal Law Academy