Fairness: A Legal Principle in EU Tax Law?

Abstract

In the public debate on taxation, fairness has become a dominant issue over the past few years. In recent communications, the European Commission refers to ‘fairness’ as well and uses it as a benchmark. Legal philosophers have developed a definition of the principle of fairness which focuses on the relations between tax payers and expectations they have of each other. It is this concept of fairness which seems to be dominant in the current public debate on fairness: it is not so much the tax system itself which is debated, but the use some tax payers make of this tax system resulting in other tax payers having to pay more. The question is whether we can distinguish such a principle of fairness in EU tax law as well. This paper analyses this question by taking as a starting point the discussion on fairness in legal philosophy. Next, it is analyses whether this principle is used in EU legislation and by the European Commission. Finally case law of the ECJ is analysed: does the principle of fairness as developed by legal philosophers and used by the European Commission play a role in case law of the ECJ, in other words, is fairness a legal principle of EU tax law? It is concluded that the principle of fairness as developed by Hart and Rawls is currently not a principle of EU tax law. The author does not expect it to become a principle of EU tax law soon. However, the concept of fairness and the emphasis which is put on it both by the European Commission, politicians and NGOs might influence the borders and impact of the principle of abuse of law which can be regarded as a restricted reflection of the principle of fairness.

Keywords: fairness, tax law

JEL Classification: H26, K34