Commentary

V1.229 Decisions granting derogations

Part V1 General principles and rates of tax

V1.229 Decisions granting derogations

V1.229 Decisions granting derogations

The Council of Ministers and the Commission, and the European Parliament acting jointly with the Council, are empowered to issue decisions in order to carry out their tasks. Decisions are binding in their entirety upon the member states, firms or individuals to whom they are addressed, and take effect when notified to them. The reasons on which they are based, and any proposals or opinions obtained, are stated. Decisions imposing a pecuniary obligation on firms or individuals are enforceable under the civil procedure of the member state in which enforcement takes place1. The Court of Justice has held that decisions may, in principle, be invoked by individuals even when addressed to member states2.

The Council, acting unanimously on a proposal from the Commission, may authorise any member state to introduce special measures for derogation from Directive 2006/112/EC in order to simplify the procedure for charging tax or to prevent certain types of tax evasion or avoidance3. Measures already in place on 1 January 1977 may continue to be applied4. The concept of tax avoidance for this purpose is a matter of EU law. It is determined by objective criteria. It follows that a derogating measure may apply to a trader carrying on his business in a manner determined by commercial considerations and without any intention of obtaining a tax advantage5.

The procedure whereby the tacit approval6 of a derogation by the Council could be obtained by default has been replaced by a system which requires the Commission to

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