European Commission to refer Belgium to the European Court of Justice

Today, the European Commission decided to refer Belgium to the European Court of Justice for its failure to comply with the Treaty principle of free movement of workers, as regards taxation of non-resident taxpayers with modest income.

In its judgment of 10 March 2022 (European Commission v the Kingdom of Belgium, Case C-60/21) the ECJ found that Belgium infringed the Treaty by refusing non-resident taxpayers who earn less than 75% of their worldwide income in Belgium from deducting their alimony payments from their taxable income.

In response to the 2022 judgment, Belgium extended the personal scope of the tax deduction. However, it did not eliminate the infringement in its entirety.

Following a letter of formal notice sent in July 2023 as a last attempt to bring the Belgian legislation in line with the Court's judgment, the Commission decided today to refer Belgium for a second time to the Court, requesting financial sanctions for the failure of bringing the national legislation in compliance with EU legislation.

More details to be found here.