3.3.3.4 Administrative difficulties

I note that the EU has already introduced measures, which aim at the better cooperation between the EU Member States’ tax authorities in relation to the exchange of information and the recovery of tax claims.

First, exchange of information on death and gift taxes already takes place within the EU under the EU Directive 2011/16/EU on administrative cooperation in the field of taxation. The Directive applies to all types of taxes and therefore, death and gift taxes fall within the exchange of information framework that the Directive has introduced. More specifically, under Article 1(1) of the Directive, “[t]his Directive lays down the rules and procedures under which the Member States shall cooperate with each other with a view to exchanging information that is foreseeably relevant to the administration and enforcement of the domestic laws of the Member States concerning the taxes referred to in Article 2.” Under Article 2, “1. This Directive shall apply to all taxes of any kind levied by, or on behalf of, a Member State or the Member State’s territorial or administrative subdivisions, including the local authorities.” (Italics, VD). As Article 2 does not explicitly exclude death and gift taxes from the scope of the Directive, EU Member States may exchange information regarding these taxes under the conditions laid down in Chapter II of the Directive.

Moreover, the EU Directive 2010/24/EU lays down rules on the assistance in the collection for the recovery of claims relating to taxes, duties and other measures of taxes between the EU Member States. Death and gift taxes also fall within the scope of this Directive. Under Article 2 of the Directive, “1. This Directive shall apply to claims relating to the following: a) all taxes and duties of any kind levied by or on behalf of a Member State or its territorial or administrative subdivisions, including the local authorities, or on behalf of the Union; […]”.

Although both EU Directives apply to death and gift taxes, some of the problems of Mr D’s beneficiaries, as presented in section 3.1.4.2, might remain unsolved. This is because the available legal framework within the EU aims at the effective collaboration between the EU Member States’ tax authorities. On the contrary, the available legal framework within the EU does not deal with administrative issues arising at the micro level.