The jurisprudence of the European Court of Justice (ECJ) has a significant impact on the tax systems of EU Member States. Although direct taxation falls within their competence, Member States are bound by the fundamental freedoms when it comes to cross-border situations. In “Allocating Taxing Powers within the European Union”, renowned experts in international tax law deal with the problems and tensions that arise when European law meets national tax sovereignty.

The authors try to overcome the traditional approach of the judicature of the ECJ regarding the application of the fundamental freedoms in direct taxation that is largely built on a non-discrimination test. They discuss various aspects of the national and international tax order with the overarching goal to flesh out the extent to which a substantive “allocation of taxing powers” within the European Union is on its way to a convincing overall framework.

One major field of research presented in this volume refers to basic elements of the national and international tax order. Traditional pillars of income taxation – ability-to-pay, source and residence, territoriality, abuse of law, arm’s length standard – are tested with respect to their place in the emerging European tax order.

Moreover, substantial matters of co-existence between different tax systems, which are not covered by the non-discrimination approach like mutual recognition, cross-border loss compensation or avoidance of double taxation, are examined in more detail. The authors propose a more courageous handling of these obstacles in order to arrive at a fully-fledged Internal Market and try to stretch the debate on the requirements of a European tax order “beyond discrimination”.

“Allocating Taxing Powers within the European Union ” is the second volume of a series entitled “MPI Studies in Tax Law and Public Finance”. The papers contained in the volume are the result of an interdisciplinary conference held in December 2010 at the Max Planck Institute for Tax Law and Public Finance.

Schön, Wolfgang / Richelle, I. / Traversa, E. (eds.): Allocating Taxing Powers within the European Union (MPI Studies in Tax Law and Public Finance, Volume 2). Heidelberg, Springer, p. 220, 2013.

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Published:   MPI Studies in Tax Law and Public Finance.