The European Commission (EC) is to carry out a thorough assessment of member states' tax regimes to determine whether they create disadvantages for mobile EU citizens.
Worker mobility is both a fundamental right for European citizens and a key instrument for developing a Europe-wide job market. However, tax obstacles, which may arise either in the state of origin or in the new state of residence, remain one of the key deterrents to EU citizens leaving their state of origin to look for work in another member state. The EC aims to ensure that workers and EU citizens residing in states other than their own are not treated differently from nationals of the host state and that they enjoy the same tax advantages as national workers.
Throughout 2014, the EC will scrutinise and assess whether EU citizens (workers, the self-employed and pensioners), residing in a member state other than their own are penalised and taxed more heavily as a result of their mobility.
Tax disadvantages to EU citizens may arise because of the location of their investments or assets, the location of the taxpayer himself or due to the mere change of the taxpayer's residence; in respect of their contributions to pensions schemes, receipt of pensions or transfers of pension and life insurance capital; in respect of their self-employed activities carried-out in another state or due to the mere relocation of such activities; because of the refusal of certain tax deductions or tax benefits; and because of their accumulated wealth.
If discrimination or breaches of the EU's fundamental freedoms are found, the EC will flag them to the national authorities and insist that necessary amendments are made. Should the problems persist, the EC may initiate infringement procedures against the member states in question.
Algirdas Aemeta, commissioner for Taxation, Customs, Anti-Fraud and Audit, said: 'EU rules are clear: all EU citizens must be treated equally within the single market. There cannot be discrimination, and workers' right to free movement must not be impaired. It is our duty to citizens to ensure that these principles are reflected in practice in all member states' tax rules.'
More details are available HERE